PMI Calculator

If you buy a home with less than 20% down on a conventional loan, your lender almost always requires private mortgage insurance (PMI) - an extra monthly charge that protects the lender, not you, if you stop paying. On a $350,000 home with 10% down ($35,000), the $315,000 loan at a typical 0.5% PMI rate adds about $131 per month, or roughly $1,575 a year, on top of your principal, interest, taxes, and insurance. This PMI calculator shows that premium, the total you will pay, and - most importantly - the month it disappears. For the full payment with PMI rolled in, pair it with our mortgage calculator.

How PMI is calculated

Monthly PMI is a flat slice of your loan, spread across 12 months:

where loan is the home price minus your down payment and PMI rate is the annual percentage your lender quotes (commonly 0.3%-1.5%). The premium is charged only while your down payment is under 20% - that is, while your loan-to-value (LTV) is above 80%. Put down 20% or more and PMI is $0 from day one.

A worked example

Take a $350,000 home with 10% down ($35,000), leaving a $315,000 loan at a 0.5% PMI rate on a 30-year mortgage at 6.5%. The monthly PMI is $315,000 × 0.005 ÷ 12 = about $131. Amortizing the loan, the balance reaches 80% of the original value (request threshold) after roughly 8 years and 78% (automatic cancellation) about a year later, near the 9-year mark. Paying PMI until the automatic drop-off costs around $14,000 in total - but requesting cancellation the moment you hit 80% saves you those extra months, roughly $1,800 here.

The 80% and 78% rules

The federal Homeowners Protection Act gives borrowers two key rights on conventional loans:

• Request cancellation at 80% LTV: once your balance is scheduled to reach 80% of the original value (20% equity), you can ask your servicer in writing to drop PMI.
• Automatic cancellation at 78% LTV: the servicer must cancel PMI on its own when the balance hits 78% of the original value, provided you are current on payments.

Because requesting at 80% is earlier than the automatic 78% point, acting promptly saves you the premiums in between. The calculator estimates both dates from your loan, rate, and term.

How to use this PMI calculator

You only need five numbers to get a realistic estimate:

1. Home price: the purchase price of the property.
2. Down payment: the cash amount or a quick percentage. If it is 20% or more, the result will correctly show $0 PMI.
3. PMI rate: the annual rate your lender quotes, usually between 0.3% and 1.5%. Use 0.5% as a middle-of-the-road placeholder if you do not have a quote yet.
4. Interest rate: your mortgage rate - this controls how fast the balance falls and therefore when PMI drops off.
5. Loan term: 30, 20, or 15 years. Shorter terms build equity faster and cancel PMI sooner.

Read the monthly PMI at the top, then the total-cost cards and the drop-off table to see when you can request removal and when it ends automatically.

Who this calculator is for

It is built for anyone buying with less than 20% down who wants to know the real cost of that smaller down payment:

• First-time buyers weighing a 3%-10% down payment against saving longer for 20%.
• Current homeowners who already pay PMI and want to know when they can ask their servicer to remove it.
• House hunters comparing two homes where one needs PMI and the other does not.
• Refinancers checking whether building equity has put them past the 80% mark.
• Budgeters who want the PMI line broken out from the rest of the mortgage payment.

Key PMI terms explained

• PMI (private mortgage insurance): a premium on conventional loans that protects the lender when your down payment is under 20%.
• LTV (loan-to-value): the loan balance divided by the home value. PMI rights are tied to LTV reaching 80% (request) and 78% (automatic).
• Original value: the lesser of the purchase price or the appraised value at closing - the figure the 80%/78% thresholds are measured against.
• Borrower-paid vs. lender-paid PMI: borrower-paid PMI is a separate monthly premium you can cancel; lender-paid PMI is baked into a higher interest rate and cannot be cancelled the same way.
• Up-front (single-premium) PMI: a one-time payment at closing instead of monthly premiums, sometimes partially refundable early in the loan.

Scenario comparison: same home, different down payments

Using a $350,000 home and a 0.5% PMI rate, here is how the down payment changes the picture:

• 5% down ($17,500): a $332,500 loan with PMI around $139/month, and it takes the longest to reach 80% equity, so you pay PMI the longest.
• 10% down ($35,000): a $315,000 loan with PMI around $131/month, cancelling roughly two to three years sooner than the 5% case.
• 20% down ($70,000): a $280,000 loan with no PMI at all - the premium is $0 from the start.

The takeaway: a smaller down payment costs you twice - a larger loan and a PMI premium you carry until you build 20% equity.

What changes the result the most

Adjust the inputs and a few factors dominate how much PMI you pay:

• Down payment: the biggest lever - it sets your starting LTV and how soon you reach the 80% cancellation point.
• PMI rate: scales the monthly premium directly; a 0.3% vs. 1.0% rate roughly triples the cost for the same loan.
• Loan amount: a larger loan means a larger premium even at the same rate.
• Interest rate and term: these control how fast principal is paid down, which sets the drop-off dates. A 15-year loan cancels PMI far sooner than a 30-year one.

Tips to pay less PMI

• Reach 20% if you can: even a slightly larger down payment can push you to or past the threshold and skip PMI entirely.
• Improve your credit first: PMI rates are credit-tiered, so a higher score can meaningfully lower the premium.
• Make extra principal payments: reaching 80% LTV faster ends PMI sooner - the drop-off table shows the target.
• Request cancellation at 80%, do not wait for 78%: ask in writing the moment your balance is scheduled to hit 80%.
• Track home value: a strong increase in value can justify an early cancellation request, usually with a lender-accepted appraisal.

Limitations and assumptions

This is a planning estimate, not a loan quote. Keep these assumptions in mind:

• It models conventional borrower-paid monthly PMI, not FHA MIP, lender-paid PMI, or single-premium PMI.
• Drop-off dates assume on-time payments and a fixed interest rate, with no change in the home's value.
• Your actual PMI rate depends on credit score, loan type, term, and the insurer - the figure here is an estimate.
• It does not include the rest of your payment (principal, interest, taxes, insurance, HOA) - use the Mortgage Calculator for the full PITI.
• Servicers may require the loan to be a certain age and the payments current before cancelling PMI, even after you reach 80%.

How it compares to related calculators

This page answers "how much is my PMI and when does it end?" For other questions, a sister tool fits better:

• For your complete monthly payment including PMI, taxes, and insurance, use the Mortgage Calculator.
• To plan a down payment that avoids PMI, use the Down Payment Calculator.
• To see whether refinancing could drop PMI or lower your rate, use the Refinance Calculator.
• For a payment-by-payment view of how the balance falls, use the Amortization Calculator.
• To find a price that fits your income and skips PMI, use the Home Affordability Calculator.
• To tap equity once PMI is gone, see the HELOC Calculator.

PMI vs. FHA mortgage insurance (MIP)

The single most common mix-up is treating conventional PMI and FHA mortgage insurance as the same thing. They are not, and the difference can cost tens of thousands of dollars over the life of a loan:

• Loan type: PMI sits on conventional loans; the Mortgage Insurance Premium (MIP) sits on FHA loans backed by the Federal Housing Administration.
• Up-front charge: FHA loans add a one-time up-front MIP (a percentage of the loan financed into the balance) on top of the monthly premium. Conventional PMI has no mandatory up-front fee in the standard monthly structure.
• Cancellation: conventional PMI is cancellable at 80%/78% loan-to-value under the Homeowners Protection Act. On most FHA loans with a low down payment, MIP lasts the life of the loan and can only be removed by refinancing into a conventional loan once you have enough equity.
• Who it suits: FHA can be easier to qualify for with a lower credit score, but a borrower with strong credit who can reach 20% equity reasonably soon often pays less overall with a conventional loan and cancellable PMI.

This calculator models conventional PMI only. If you are weighing FHA against conventional, the deciding factor is usually how long the insurance sticks around: cancellable PMI versus life-of-loan MIP. Running both scenarios in our mortgage calculator alongside the PMI timeline here makes the long-run cost gap obvious.

Three ways to structure PMI

Borrowers often assume PMI is a single fixed product, but lenders typically offer three structures, and the right one depends on how long you expect to keep the loan:

• Borrower-paid monthly PMI (BPMI): the default this calculator models. You pay a separate monthly premium that you can cancel at 80% LTV. Best if you expect to build 20% equity within a few years - you only pay until you hit the threshold.
• Lender-paid PMI (LPMI): the insurance is folded into a slightly higher interest rate instead of a separate line item. The payment looks smaller, but the higher rate lasts the entire loan and cannot be cancelled at 80% - so it can cost more if you keep the loan long-term. It can make sense if you plan to refinance or move within a few years.
• Single-premium (up-front) PMI: one lump-sum premium paid at closing, sometimes partially refundable if you cancel early in the loan. It removes the monthly charge entirely, which lowers the payment, but ties up cash at closing that could go toward a larger down payment.

For most buyers who intend to stay put and build equity, plain borrower-paid monthly PMI is the cheapest because it ends. Compare the cash you would commit to a single premium against simply putting that money down - a bigger down payment lowers the loan, the PMI base, and the time to 80% all at once. The down payment calculator helps you test that trade-off.

Sources

• Consumer Financial Protection Bureau (CFPB) - What is private mortgage insurance (PMI)?
• Consumer Financial Protection Bureau (CFPB) - When can I remove private mortgage insurance (PMI) from my loan?
• Consumer Financial Protection Bureau (CFPB) - Owning a Home: mortgage basics.