PMI Calculator
Private mortgage insurance is charged on a conventional loan when you put down less than 20%. Monthly PMI = loan × annual PMI rate ÷ 12, and it cancels once your balance reaches 80% of value (automatic at 78%). This calculator shows the cost and the drop-off date.
Use this PMI calculator to see exactly what private mortgage insurance adds to your payment and how long you will pay it. Enter the price, down payment, PMI rate, loan rate and term — it returns your monthly PMI, your loan-to-value, the full payment, and the month PMI can be cancelled at 80% and 78% LTV.
Enter the price, down payment and PMI rate, then press Calculate to see your PMI and when it ends.
How the PMI calculator works
Private mortgage insurance is the price of buying with less than 20% down on a conventional loan. It protects the lender, not you, and it is added straight to your monthly payment. This calculator computes it the way lenders do: your annual PMI rate times the loan amount, divided by twelve. On a $360,000 loan at 0.5%, that is $150 a month. Just as important, the tool simulates your amortization to show when PMI ends — the month your balance falls to 80% of the original value, when you can request cancellation, and 78%, when the lender must remove it automatically.
Knowing the end date changes the decision. PMI is not permanent like some FHA insurance, so the real question is how many payments you will make before it drops off. If you are weighing a smaller down payment against a larger one, compare the full payment on the mortgage calculator, and if you have a military connection, remember a VA loan skips monthly insurance entirely.
The PMI formula
- Loan — price − down payment
- PMI rate — 0.3%–1.5% a year by credit and down payment
- Cancel at — 80% LTV on request, 78% LTV automatically
When PMI cancels — 80% vs 78%
Federal law gives you two milestones. At 80% loan-to-value — measured against the home's original value — you have the right to request cancellation in writing, provided you are current and the lender is satisfied the value has not dropped. At 78% LTV, cancellation is automatic: the servicer must remove PMI without you asking. Both are based on the original amortization schedule, which is what this calculator simulates. Paying extra principal, or a reappraisal after your home appreciates, can bring either milestone forward.
Is a smaller down payment worth the PMI?
Not always a bad trade. PMI lets you buy sooner and keep cash in reserve, and because it cancels, it is a temporary cost rather than a permanent one. The counter-argument is simple: on the example above, $150 a month for nine years is roughly $16,000 before it drops off. Whether that is worth avoiding depends on how quickly you could otherwise save a 20% down payment, and what the home might do in the meantime. Run both scenarios and compare the total cost, not just the monthly figure.
Estimate only — not a loan offer or financial advice. Actual PMI rates are set by the insurer and lender based on your credit, loan type and down payment. Cancellation rules follow the Homeowners Protection Act; confirm specifics with your servicer.
How to use it & key terms
Enter the price, down payment, PMI rate, loan rate and term, then press Calculate to see your monthly PMI, loan-to-value, full payment and the month PMI drops off.
| Term | What it means |
|---|---|
| PMI | Private mortgage insurance on a conventional loan under 20% down. |
| LTV | Loan-to-value — the loan as a percentage of the home's value. |
| PMI rate | The annual insurance rate, charged on the loan amount. |
| 80% cancellation | The LTV at which you can request PMI removal. |
| 78% cancellation | The LTV at which removal is automatic. |
| P&I | Principal and interest — the core loan repayment. |
Sources & methodology
Monthly PMI is calculated as the loan amount times the annual PMI rate divided by twelve, the standard lender method. If your down payment is 20% or more, PMI is zero. The calculator amortizes the loan at the entered rate and term and steps through the schedule to find the first month the balance reaches 80% and 78% of the home's original value — the request and automatic cancellation thresholds set by the federal Homeowners Protection Act. Total PMI paid is the monthly amount multiplied by the months until the 78% automatic cancellation. Property tax and insurance are added for the full payment view.
Sources: Homeowners Protection Act of 1998 PMI cancellation thresholds (80% on request, 78% automatic), and the standard mortgage amortization formula. PMI rate ranges per Consumer Financial Protection Bureau guidance.
Routes to drop PMI sooner
Private mortgage insurance is meant to be temporary, and there are several ways off it — some automatic, some you have to trigger. Knowing all of them can save you from paying the premium longer than necessary.
The two built-in rights come from federal law on most conventional loans. You may request cancellation once your balance is scheduled to reach 80% of the home's original value, and the servicer must cancel automatically at 78%, provided you are current. There is also a lesser-known backstop: if you have not reached 78% by the loan's amortization midpoint, PMI must drop at that midpoint anyway. Paying a little extra principal each month pulls all of these dates forward, because the balance falls faster than the original schedule.
The other routes rely on your home's value rather than just the paydown:
- New appraisal on appreciation. If local prices have risen, an appraisal may show you now hold enough equity to cancel, even though your balance alone has not reached the threshold. Servicers set their own equity requirements and seasoning periods for this.
- Value-adding improvements. Substantial renovations can lift the appraised value the same way, so a major upgrade or addition might qualify you earlier.
- Refinancing out. If your equity has grown past 20%, refinancing into a new loan with no PMI can remove it — worthwhile only when the new rate and closing costs make sense.
It also helps to know which type of PMI you have. With borrower-paid PMI — the common kind — the premium is a separate line in your payment that goes away when you cancel. With lender-paid PMI, the cost is baked into a higher interest rate instead, so there is no separate charge to cancel; the only way to escape it is to refinance. That distinction matters, because a slightly lower headline rate with lender-paid PMI can quietly follow you for the life of the loan. None of the value-based routes are guaranteed, and the appraisal is usually at your expense — but prompting your servicer when you cross 80%, rather than waiting for 78%, is the surest way to stop paying for insurance you no longer need.
Frequently asked questions
What is PMI?
Private mortgage insurance is insurance a lender requires on a conventional loan when your down payment is less than 20%. It protects the lender if you default, not you. PMI is added to your monthly payment and typically costs 0.3% to 1.5% of the loan per year, depending on credit and down payment.
How much does PMI cost per month?
Monthly PMI is your annual PMI rate times the loan amount, divided by twelve. A 0.5% rate on a $360,000 loan is $1,800 a year, or $150 a month. Rates rise with a smaller down payment and lower credit score, so PMI can range from under $100 to several hundred dollars monthly.
When does PMI go away?
On a conventional loan you can request cancellation once your balance reaches 80% of the home's original value, and the lender must cancel automatically at 78%. This calculator estimates both points from your regular payments. Extra payments or rising value can get you there sooner.
How can I avoid PMI?
The simplest way is to put down 20% or more, which avoids PMI entirely on a conventional loan. Other routes include a piggyback second mortgage, lender-paid PMI (usually a higher rate), or a government loan such as VA, which has no monthly mortgage insurance.
Is PMI based on the home price or the loan?
PMI is calculated on the loan amount, not the purchase price. The rate is set largely by your loan-to-value ratio and credit score. A larger down payment lowers both the loan the PMI is charged on and often the rate applied, so the savings compound.
Does PMI reduce over time?
Most PMI is a fixed monthly amount based on the original loan and does not shrink as you pay down the balance. The real saving comes when it cancels entirely at 80% or 78% loan-to-value. This tool shows how many months that takes on your schedule.
Is PMI tax deductible?
The mortgage insurance premium deduction has expired and been reinstated several times, and its availability depends on current tax law and income. Do not assume PMI is deductible; check the latest IRS guidance or a tax professional before counting on it.
How do I get rid of PMI without refinancing?
You usually do not need to refinance. On a conventional loan, request cancellation once your balance reaches 80% of the home's original value, or let it drop automatically at 78%. Paying extra principal gets you there sooner, and if the home has appreciated, a lender-approved appraisal can let you cancel early based on the current value. Refinancing is only needed to escape FHA mortgage insurance, which does not cancel like PMI.
Can you remove PMI from an FHA loan?
Not the same way. FHA charges MIP, not PMI, and with less than 10% down it lasts the life of the loan. The usual way to end it is to build equity and refinance into a conventional loan, which drops the FHA insurance entirely. With 10% or more down, FHA MIP ends on its own after 11 years.
What is the difference between PMI and MIP?
PMI is private mortgage insurance on a conventional loan; MIP is the FHA equivalent. The key difference is cancellation: conventional PMI ends at 80% or 78% loan-to-value, while FHA MIP often lasts the life of the loan unless you put 10% or more down. That makes conventional PMI the cheaper insurance to escape.