PMI Calculator

About the PMI Calculator

Private mortgage insurance (PMI) is generally required on a conventional mortgage when the down payment is below 20%. PMI protects the lender rather than the borrower, and it raises the total monthly housing cost. The actual premium depends on the lender, mortgage insurer, credit profile, down payment, and loan program.

This calculator estimates monthly PMI using an internal rate table tied to the selected loan-to-value ratio and credit-score bucket. It also estimates the dates when the loan reaches 80% LTV (when a borrower may be able to request removal) and 78% LTV (when automatic termination may apply under the Homeowners Protection Act if the loan remains in good standing).

The result is a planning estimate designed to compare scenarios. It is not a lender-issued mortgage-insurance quote.

When This Page Helps

PMI is one of the largest hidden costs of buying a home with less than 20% down. This calculator helps you understand exactly how much PMI adds to your payment, how long you will pay it, and how much total PMI you will spend. Armed with this information, you can decide whether to put more down, choose a different loan product, or plan for PMI removal.

How to Use the Inputs

1. Enter the home price and your loan amount (or down payment percentage).
2. Select your approximate credit score range.
3. The calculator estimates your PMI rate based on LTV and credit score.
4. Review the monthly PMI cost and total PMI over the removal period.
5. See the estimated dates for PMI request (80% LTV) and auto-cancel (78% LTV).
6. Consider strategies to reduce PMI duration if the cost is significant.

Example Calculation

Tips & Best Practices

• Credit scores of 760+ get the lowest PMI rates — improving your score before buying can save hundreds per month.
• Consider a piggyback loan (80-10-10) to avoid PMI: 80% first mortgage, 10% second mortgage, 10% down.
• Lender-paid PMI (LPMI) is an alternative where the lender covers PMI in exchange for a higher rate — sometimes cheaper long-term.
• You can request PMI removal when you reach 80% LTV through payments or appreciation (appraisal required).
• Making extra payments accelerates PMI removal — even small extra amounts reduce the timeline.
• FHA loans have MIP (mortgage insurance premium) which works differently and cannot be removed on most newer FHA loans.

Understanding LTV and PMI Rates

Loan-to-value ratio is one of the main drivers of PMI pricing. Higher LTVs generally mean higher insurance costs because the lender is taking more risk relative to the property value. This worksheet uses simplified ranges to show that directional relationship, not insurer-specific pricing tables.

The Cost of PMI Over Time

Even when the monthly PMI charge looks manageable, the cumulative cost over several years can be material. That is why many borrowers compare different down-payment amounts, extra-principal strategies, and possible PMI-removal timing before finalizing the loan structure.

PMI Removal Strategies

Borrowers often evaluate three paths: waiting for scheduled amortization, making extra principal payments, or asking the servicer about updated-value reviews when the property has appreciated. The right path depends on the loan documents, servicer standards, and the cost of any new appraisal or review.

Frequently Asked Questions

• How much does PMI cost?

  PMI typically costs 0.3% to 1.5% of the loan amount per year. On a $350,000 loan, that is $87 to $437 per month. Your exact rate depends on your LTV ratio and credit score — higher LTV and lower credit scores mean higher PMI rates.

• When can I remove PMI?

  You can request PMI removal when your LTV reaches 80% of the original home value. Your lender must automatically cancel PMI when the scheduled balance reaches 78%. You can also request early removal if your home has appreciated enough to bring LTV below 80% (requires a new appraisal).

• Is PMI tax deductible?

  The tax treatment of mortgage insurance premiums has changed over time. Check the IRS instructions for the tax year in question or a tax professional before assuming PMI is deductible.

• What is the difference between PMI and MIP?

  PMI (Private Mortgage Insurance) applies to conventional loans and can be removed at 80% LTV. MIP (Mortgage Insurance Premium) applies to FHA loans and typically lasts the entire loan life if you put less than 10% down. MIP has both an upfront fee (1.75%) and an annual fee.

• Can I avoid PMI with less than 20% down?

  Yes. Options include piggyback loans (80-10-10 structure), VA loans (no PMI, no down payment for eligible veterans), lender-paid PMI (higher rate, no separate PMI payment), and some credit union special programs that waive PMI requirements.

• Does PMI decrease over time?

  Standard PMI does not automatically adjust — the rate stays the same until removal. However, the actual dollar amount stays constant because it is based on the original loan amount in most cases. Some plans recalculate annually based on the remaining balance, which does decrease the cost slightly.

• How does credit score affect PMI rates?

  Credit score is a major factor. A borrower with a 760+ score and 90% LTV might pay 0.30-0.40%, while a borrower with a 660 score and the same LTV could pay 0.90-1.10%. Improving your score by even 20 points can meaningfully reduce PMI costs.

• What is lender-paid PMI?

  With lender-paid PMI (LPMI), the lender covers the insurance cost but charges a higher interest rate — typically 0.25-0.50% more. LPMI cannot be removed since it is built into the rate. It may be cheaper if you plan to sell or refinance within a few years, but more expensive long-term.