PMI Calculator
Estimate your Private Mortgage Insurance costs with our free PMI calculator. Enter your home price, down payment percentage, and PMI rate to see monthly and annual costs, your LTV ratio, and how long until PMI is automatically removed.
Private Mortgage Insurance (PMI) is required by most lenders when a borrower makes a down payment of less than 20% on a conventional mortgage. PMI protects the lender (not the borrower) against loss if the borrower defaults. Typical PMI rates range from 0.3% to 1.5% of the original loan amount per year, depending on the borrower's credit score, down payment size, and loan type.
PMI can be removed once your Loan-to-Value (LTV) ratio drops to 80% (by your request) or 78% (automatic cancellation under the Homeowners Protection Act). LTV decreases as you make mortgage payments and as the home appreciates in value. You can request early PMI removal based on a new appraisal showing sufficient equity, which can save years of PMI payments.
While PMI adds to your monthly costs, it enables homeownership with less than 20% down. On a $400,000 home with 10% down, PMI at 0.5% costs about $150 per month. Waiting to save an additional 10% ($40,000) for a 20% down payment could take years, during which home prices may rise significantly. PMI is often a worthwhile trade-off to buy sooner and start building equity.