PMI Removal Calculator
Calculate when you can drop Private Mortgage Insurance (PMI) — automatic at 78% LTV, request at 80%, or appraisal route. PMI costs $30-$70/month per $100K borrowed — drop it ASAP to save thousands.
How to Remove PMI — Three Paths
(1) Automatic Termination at 78% LTV: lender MUST cancel when you reach 78% of original purchase price (or appraised value at origination if FHA conventional). (2) Request Termination at 80%: you can REQUEST cancellation when LTV hits 80%, lender must approve if requirements met (good payment history, no second liens). (3) Appraisal Route: if home appreciated, get appraisal showing 75-80% LTV based on CURRENT value — saves years off PMI.
Home Price Appreciation — The Hidden PMI Killer
Most homeowners don't realize: rapid appreciation can drop PMI years earlier than paying down principal. Example: $400K home with $360K loan = 90% LTV originally. After 2 years of 6% appreciation: home worth $450K. Loan paid down to $345K = 76.7% LTV. Eligible for appraisal-based PMI removal. Cost: $400-$700 appraisal. Savings: $200-$400/month for years.
FHA Loans — Different Rules
FHA Mortgage Insurance Premium (MIP) is different from conventional PMI. For FHA loans with 10%+ down: MIP drops automatically after 11 years. For FHA loans with <10% down: MIP stays for LIFE of loan. Only escape: refinance into conventional loan. As FHA borrower with significant equity (75% LTV+) consider refinancing to conventional to drop MIP.
The PMI Math — Real Costs
PMI typically 0.3-1.5% of loan balance annually. On $350K loan: $1,050-$5,250/year ($87-$437/month). Dropping PMI at 80% LTV instead of waiting for 78% automatic: saves 6-18 months on average = $500-$5,000. Always request — many lenders forget to inform you. Federal Homeowners Protection Act of 1998 requires PMI termination at 78% LTV (not appraised value, just original purchase price).
Sources: Homeowners Protection Act of 1998, CFPB PMI removal guidance, HUD FHA Handbook 4000.1. Last updated: May 2026.