PMI Calculator
See what mortgage insurance costs each month, how long you will pay it, and what it would take to remove it.
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What PMI is and when it stops
Private mortgage insurance protects the lender, not you. If you default and the home sells for less than the loan, the insurer covers the lender's loss. You pay the premium, you receive nothing, and not one dollar of it reduces your balance. It normally applies to conventional loans whenever the deposit is below 20 percent of the purchase price.
The cost is usually expressed as an annual percentage of the loan and charged monthly. Rates range from about 0.3 to 1.5 percent depending on your credit score and deposit size. On a 360,000 dollar loan at 0.6 percent that is 180 dollars a month, or 2,160 dollars a year, for insurance that builds you no equity at all.
How long you pay it depends on which of two thresholds you reach first. By repayment alone, the balance falls to 80 percent of the original value after about 95 months on a 30-year loan. But borrowers may request cancellation based on a new appraisal once the home's value rises enough, and at 3 percent annual appreciation that happens after roughly 48 months. The difference is four years of payments instead of eight.
That second route is frequently overlooked and it is where the real saving sits. Reaching 20 percent equity and asking the lender to cancel PMI turns 8,640 dollars of premiums into nothing. The trigger is automatic at 78 percent loan-to-value based on the original price, but the request at 80 percent based on current value has to come from you, and lenders are not obliged to volunteer it.
How PMI and its end date are calculated
The monthly cost is the annual rate applied to the loan and divided by twelve. The end date is found by walking the balance down month by month and comparing it with the 80 percent threshold.
| Symbol | Meaning |
|---|---|
Loan |
The mortgage amount, not the purchase price |
annual rate |
The PMI rate quoted by the lender, commonly 0.3% to 1.5% |
Price |
The home's value, either the original price or a new appraisal |
Balance |
What is still owed, which falls with every payment |
Two end dates are shown because there are two routes. Repayment uses the original price and the automatic 78 percent threshold. Appreciation uses a current appraisal and the 80 percent request threshold, which is available to you but must be asked for.
Worked example: 400,000 dollar home with 10 percent down
A 360,000 dollar loan at 6.5 percent over 30 years with PMI at 0.6 percent a year and 3 percent annual appreciation.
| Figure | Result |
|---|---|
| Home price | $400,000.00 |
| Down payment (10%) | $40,000.00 |
| Loan amount | $360,000.00 |
| Principal and interest | $2,275.44 |
| Monthly PMI | $180.00 |
| Payment including PMI | $2,455.44 |
| PMI ends by repayment after | 95 months |
| PMI ends by appreciation after | 48 months |
| Total PMI paid | $8,640.00 |
| Deposit needed to avoid PMI entirely | $80,000.00 |
You pay 180 dollars a month, which is nothing but a cost. Left to repayment alone it would run for 95 months and cost 15,900 dollars, but asking for cancellation on an appraisal at the 80 percent threshold ends it after 48 months for 8,640 dollars. Doubling the deposit to 80,000 dollars would have avoided it completely, which is worth weighing against the cost of saving the extra 40,000.
Estimates only. Your lender's figures may differ because of fees, escrow and rounding.
Getting rid of PMI sooner
Ask for cancellation, do not wait for it
Lenders must cancel PMI automatically at 78 percent loan-to-value based on the original price, but you can request it at 80 percent based on a current appraisal. On the example here that request ends the premium four years early and saves 8,640 dollars. Nobody will make the call for you.
Use appreciation, not just repayment
Paying the balance down to 80 percent takes almost eight years. A rising market reaches the same equity in about four, and a new appraisal is all it takes to convert that into a cancelled premium. In a flat or falling market this route disappears, which is why the calculator shows both.
Check whether a single premium is cheaper
Some lenders offer borrower-paid single-premium mortgage insurance, paid as a lump sum at closing instead of monthly. It can be cheaper in total, but it is not refundable if you refinance or sell early. Compare the lump sum against the monthly total honestly.
Consider lender-paid PMI with clear eyes
Lender-paid mortgage insurance removes the monthly charge but comes with a higher interest rate, and that higher rate lasts for the whole loan rather than ending at 80 percent equity. It is rarely the cheaper option, but the lifetime cost comparison is worth doing.
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Frequently asked questions
How much is PMI per month?
It is typically 0.3 to 1.5 percent of the loan amount per year, charged monthly, depending on your credit score and deposit. On a 360,000 dollar loan at 0.6 percent that is 180 dollars a month. A larger deposit or a better credit score both reduce the rate.
When does PMI go away?
Automatically once the balance reaches 78 percent of the original purchase price, which on a 30-year loan takes about 95 months. You can also ask for cancellation at 80 percent based on a current appraisal, which rising prices can reach much sooner, often around four years.
Can I avoid PMI with less than 20 percent down?
Sometimes. Lender-paid PMI removes the monthly charge in exchange for a higher rate, and a piggyback structure using a second mortgage can avoid it as well. Both have costs of their own, so compare the total rather than the monthly figure alone. VA loans avoid it entirely for eligible borrowers.
Does PMI protect me if I cannot pay?
No. PMI protects the lender against loss if you default and the property sells for less than the loan. It pays you nothing and reduces your balance by nothing. That is why ending it as early as possible is worth real effort.
Does an extra payment reduce PMI?
Yes, and directly. Extra principal payments bring the balance to the 80 percent threshold sooner, which ends the premium sooner. Set the extra amount in the calculator and watch the end date move. It is one of the highest-return uses of spare cash available to a new homeowner.