Skip to content
CalculatorDash
Menu

PMI Calculator

Updated · By the CalculatorDash editorial team · How we check our maths

Quick answer

PMI usually costs about 0.3% to 1.5% of the loan per year. On a $400,000 home with 10% down ($360,000 loan) at a 0.6% PMI rate, that is about $180 a month, and it drops off automatically when the balance reaches 78% of the original value, after about 9 years at 6.5%.

PMI cost

$
%
%
% of loan

Monthly PMI

$180

Principal & interest + PMI
$2,455
PMI drops off after
9.1 years

When the balance reaches 78% of the original value.

Total PMI paid (approx.)
$19,565
Starting loan-to-value
90%

How this calculator works

Private mortgage insurance protects the lender, not you, when you put less than 20% down on a conventional US mortgage. It is usually added to the monthly payment as an annual percentage of the loan amount divided by twelve.

Under the US Homeowners Protection Act, borrower-paid PMI must end automatically when the balance is scheduled to reach 78% of the home's original value, and you can ask to cancel it at 80% if you are current on payments. The calculator uses the 78% point to estimate how long you'll pay it.

FHA loans use a different system (mortgage insurance premium) that often lasts the life of the loan, so this calculator is for conventional loans only.

The formula

Loan
price × (1 − down payment %)
Monthly PMI
loan × PMI rate ÷ 12 (zero at 20% down or more)
Removal
the month the scheduled balance reaches 78% of the original price

Worked example

A $400,000 home with 10% down means a $360,000 loan. At 0.6% a year, PMI is $180 a month. At 6.5% over 30 years the balance reaches $312,000 (78%) after about 9.1 years, so you would pay roughly $19,600 of PMI in total, less if you prepay or the home's value rises and you request removal.

Tips

  1. 01Ask to remove PMI at 80% loan-to-value; you don't have to wait for the automatic 78% point.
  2. 02If your home has gained value, a new appraisal can get PMI removed years early with many lenders.
  3. 03A higher credit score lowers the PMI rate, sometimes by half.

Frequently asked questions

How much is PMI per month?

Roughly 0.3–1.5% of the loan per year divided by 12. On a $300,000 loan at 0.5% that is $125 a month.

How do I avoid PMI?

Put down 20% or more, use a piggyback second loan, or look at loan programmes for veterans and some professions that don't charge it.

When does PMI go away?

Automatically when the scheduled balance hits 78% of the original value, or on request at 80% if your payment history is good.