PMI Calculator
Private mortgage insurance protects the lender, not you, and it typically runs for years rather than months. This prices it and works out when the balance crosses the threshold that ends it.
Mortgage insurance cost calculator
What PMI costs by credit band
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What a bigger down payment does
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Who PMI actually protects
Private mortgage insurance pays the lender if you default and the foreclosure sale does not cover the loan. It does not pay you, it does not reduce your balance, and it does not give you any interest in the property. It exists because a loan above 80 percent of the home value is statistically more likely to end in a loss, and the lender prices that risk by making you buy insurance on its behalf.
That is the whole reason the 20 percent threshold matters so much: below it, you are paying for someone else's protection, and the cost is not small. On a $380,000 loan at a 0.78 percent annual rate it is $247 a month, which is roughly what a $30,000 car loan costs.
How the premium is set
PMI is quoted as an annual percentage of the loan balance, charged monthly. The rate depends mainly on loan-to-value and credit score, and secondarily on loan term, occupancy and whether the loan is fixed or adjustable. At 95 percent LTV a 760 score might get 0.55 percent while a 640 score pays 1.35 percent — the same house, the same loan, two and a half times the cost.
On these defaults the loan is $380,000 at 95 percent LTV. At 0.78 percent the premium is $247 a month, $2,964 a year. It ends when the balance reaches 78 percent of the original value — $312,000 here — which takes 135 months, or a little over eleven years, on a 30 year amortization at 6.5 percent. Total cost before it drops off: about $33,345.
When it ends, and how to end it sooner
Federal law sets two thresholds. At 78 percent of the original value, the servicer must terminate PMI automatically. At 80 percent, you can request termination, and the servicer must agree if you are current on payments. The 80 percent request is the one people forget, and on this loan it comes roughly a year earlier than the automatic date — about $3,000 of premium.
A new appraisal can end it sooner if values have risen. If the house now appraises high enough that the balance is 75 to 80 percent of the current value, most lenders will remove PMI on request, though some require a seasoning period and most charge for the appraisal. In a market where values rose 20 percent, that can remove PMI years before the amortization schedule would.
FHA mortgage insurance is a different animal
FHA loans carry mortgage insurance premium rather than PMI, and the rules are worse. The annual MIP is 0.55 percent on most 30 year loans above 95 percent LTV, and for loans with less than 10 percent down it lasts for the life of the loan. There is no 78 percent threshold and no request to remove it — the only way out is to refinance into a conventional loan once there is enough equity.
That is why the 10 percent down line matters on an FHA loan: at 10 percent down the annual MIP drops and, on loans originated under current rules, terminates after eleven years. The difference between 9.9 and 10 percent down can be years of premium.
The ways people avoid PMI, and what each costs
A piggyback loan — an 80 percent first mortgage plus a 10 percent second — avoids PMI by keeping the first loan at 80 percent LTV. The second mortgage carries a higher rate, and the interest on it is often not deductible the same way. Lender-paid PMI raises the mortgage rate by roughly 0.25 to 0.5 points instead of charging a monthly premium, which is cheaper if you keep the loan a long time and more expensive if you refinance early. Single-premium PMI is paid up front at closing and is the cheapest on paper if you stay, and the worst if you move in three years.
None of them is free. The question is only whether you would rather pay monthly, pay at closing, or pay a higher rate for thirty years.
Frequently asked questions
How much is PMI on a $400,000 house?
About $247 a month with 5 percent down and a 700 to 759 credit score, which is 0.78 percent of a $380,000 loan annually. A 760 score would pay about $174, and a 640 score about $428.
When does PMI go away?
Automatically when the balance reaches 78 percent of the original value, and on request at 80 percent. On a 30 year loan at 6.5 percent with 5 percent down, that is about 135 months for the automatic date.
Can I remove PMI with a new appraisal?
Often yes. If the home now appraises high enough that the balance is 80 percent or less of current value, most lenders will remove it on request, usually after a seasoning period and with an appraisal fee.
Is PMI tax deductible?
It was deductible in some years under temporary rules that have since lapsed for most filers. Treat it as non-deductible unless your tax adviser says otherwise for your year.
What is the difference between PMI and MIP?
PMI is private insurance on a conventional loan and can be removed. MIP is the FHA equivalent, and on loans with less than 10 percent down it lasts for the life of the loan, so the only exit is refinancing.
Is it better to put 20 percent down or pay PMI?
Twenty percent avoids PMI entirely and lowers the payment, but it ties up cash. If 20 percent would leave you without an emergency fund, 10 percent down plus PMI is the safer choice, and the PMI can be removed later.
Does a piggyback loan really avoid PMI?
It avoids the premium by keeping the first mortgage at 80 percent LTV, but the second mortgage carries a higher rate and its interest is often not deductible. Compare the second loan's payment against the PMI it replaces.
Disclaimer: This calculator estimates mortgage insurance from the loan amount and an annual rate. Actual premiums depend on the lender, the mortgage insurer, credit, occupancy and loan type. Confirm the rate on your Loan Estimate.
Citing this page? FigureMill, “PMI Calculator” (last reviewed October 31, 2026). Monthly mortgage insurance premium, the month it terminates at 78 percent loan-to-value, and the total premium paid. https://figuremill.com/home-tax/pmi-calculator
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