PMI Calculator
Estimated monthly private mortgage insurance and when it drops off.
Monthly PMI
$150.00
LTV 90%
Loan-to-value
90%
To reach 78% LTV
$48,000.00
Annual PMI
$1,800.00
AI Breakdown & Smart Takeaway
Plain-English insight on your numbers
Get a personalized explanation of what these results mean — and how to improve them.
How the PMI Calculator works
The PMI Calculator estimates your monthly private mortgage insurance premium and projects exactly when that cost disappears from your payment — making it an essential tool for homebuyers weighing down payment options and existing homeowners looking to shed an unwanted monthly expense.
Private mortgage insurance is triggered whenever a conventional loan's loan-to-value ratio (LTV) exceeds 80% at origination. The calculator takes your home's purchase price (or current appraised value), your loan balance, and your loan's interest rate and term, then computes the LTV ratio. That ratio is fed into a PMI rate table — typically ranging from 0.2% to 2.0% of the loan amount annually, depending on LTV, credit score tier, and loan type — to produce a precise monthly premium. Most borrowers in the 90–95% LTV band with good credit pay between 0.5% and 1.0% annually, which the tool converts into a clear monthly dollar figure you can factor into your true housing cost.
The drop-off projection is the most valuable output. Under the federal Homeowners Protection Act (HPA) of 1998, lenders must automatically cancel PMI when the loan balance is scheduled to reach 78% of the original purchase price based on your amortization schedule, provided your payments are current. You can also request cancellation once you reach 80% LTV — either through scheduled payments or documented home value appreciation. The calculator builds your full amortization schedule behind the scenes, flags the month you cross 80% LTV (request date) and 78% LTV (automatic cancellation date), and tells you exactly how much total PMI you will pay if you take no action versus if you make the cancellation request proactively.
Three factors move your PMI rate the most: LTV at origination, credit score, and loan type. A borrower at 95% LTV with a 680 credit score can pay three to four times the premium of a borrower at 85% LTV with a 760 score. Loan type also matters — lender-paid PMI (LPMI) rolls the cost into a slightly higher interest rate, making it invisible on the monthly statement but impossible to cancel. Our calculator models borrower-paid PMI (BPMI), the most common structure, so the savings from cancellation are transparent. If your lender offered LPMI, remember that refinancing is the only way to escape it.
A common mistake buyers make is ignoring how extra principal payments accelerate PMI cancellation. Because PMI is calculated on the outstanding balance relative to the original value, even a modest annual lump-sum payment can move your cancellation date forward by twelve to eighteen months, saving hundreds or thousands of dollars. Conversely, many homeowners forget that rising property values can support an early cancellation request — lenders generally allow a new appraisal after two years of ownership to establish a higher value, potentially dropping LTV below 80% far ahead of schedule. This calculator helps you model both scenarios so you can make the mathematically optimal decision.
Formula
Monthly PMI = (Loan Balance × Annual PMI Rate) ÷ 12 LTV = (Current Loan Balance ÷ Home Value) × 100 PMI cancellation at LTV ≤ 80% (borrower request) or LTV ≤ 78% (automatic, per HPA)
Pro tips
- Aim for a 10% down payment if 20% is out of reach: at 90% LTV, PMI rates are significantly lower than at 95% LTV, and cancellation arrives years sooner — the combined savings often outweigh the extra cash required at closing.
- Request a new appraisal after two years of ownership if local home values have risen; if the new appraisal brings your LTV below 80%, you can petition your servicer for immediate PMI removal rather than waiting years for scheduled payments to do the work.
- Apply any annual bonus, tax refund, or windfall directly to principal in the early years of the loan — amortization front-loads interest, so early extra payments produce a disproportionately large reduction in LTV and can move your PMI cancellation date forward by 12–24 months.
- Compare the true cost of an 80/10/10 piggyback loan (first mortgage at 80% LTV + 10% second mortgage + 10% down) against a single 90% LTV loan with PMI; in a high-rate environment the piggyback's second-mortgage rate often exceeds the PMI cost, making standard PMI the cheaper option.
- Mark your calendar for your HPA request date — servicers are not required to remind you when you reach 80% LTV, so borrowers who don't proactively submit a written cancellation request often pay months of unnecessary premiums while waiting for the automatic 78% threshold.
Key terms
- Loan-to-Value Ratio (LTV)
- — The percentage of a home's appraised value that is financed by the mortgage, calculated by dividing the current loan balance by the home's value; a ratio above 80% typically triggers PMI on conventional loans.
- Private Mortgage Insurance (PMI)
- — A policy that protects the lender — not the borrower — against loss if the borrower defaults, required on conventional loans with less than a 20% down payment and charged as a monthly, annual, or upfront premium.
- Homeowners Protection Act (HPA)
- — A U.S. federal law enacted in 1998 that grants borrowers the right to request PMI cancellation at 80% LTV and mandates automatic termination at 78% LTV based on the original amortization schedule.
- Borrower-Paid PMI (BPMI)
- — The most common PMI structure, where the premium appears as a separate line item on the monthly mortgage statement and can be cancelled once sufficient equity is reached.
- Lender-Paid PMI (LPMI)
- — A PMI structure where the lender absorbs the insurance cost in exchange for a higher interest rate, making it non-cancellable without refinancing the entire loan.
- Amortization Schedule
- — A complete table of monthly loan payments showing how each payment is split between principal and interest, and how the outstanding balance declines over the life of the loan — the backbone of any PMI drop-off projection.
