PMI Monthly Cost Calculator

What Is PMI and When Do I Pay It?

Private mortgage insurance (PMI) is required by Fannie Mae, Freddie Mac, and conventional lenders whenever you put less than 20% down on a primary residence. PMI protects the lender — not you — against loss if you default. The cost is bundled into your monthly mortgage payment as a percentage of the original loan balance, typically 0.20% to 1.50% per year. Your specific rate depends on three factors: loan-to-value at origination (the higher the LTV, the higher the rate), credit score (760+ pays roughly 60% less than a 620 borrower), and loan type/occupancy (investment properties cost 25% more PMI). Per the CFPB PMI guide, the federal Homeowners Protection Act of 1998 requires the lender to automatically cancel PMI when your scheduled LTV reaches 78%, and to remove it on borrower request at 80% LTV (with proof of property value). Last updated May 2026.

How to Get Rid of PMI Faster

Three legal paths to ending PMI early: (1) Pay down to 80% LTV and request removal in writing — your servicer must honor it within 30 days if you're current on payments. (2) Order a new appraisal if your home value has risen — this is the fastest method in appreciating markets. Most lenders accept a Broker Price Opinion ($150-$300) once the loan is at least 2 years old, or require a full appraisal ($450-$600) if 12-24 months old. (3) Refinance into a new conventional loan if your current LTV is already below 80% — you skip PMI on the new loan. The IRS no longer treats PMI as deductible (the deduction expired after tax year 2021), so there's no tax-shield reason to keep paying. Per Fannie Mae PMI cancellation rules, the borrower-initiated cancellation at 80% requires a good payment history (no 30-day late in last 12 months, no 60-day late in 24 months) and a property value at or above original.

PMI vs FHA MIP — Which Is Cheaper?

FHA mortgage insurance premium (MIP) and conventional PMI compete for the same low-down-payment borrower. Conventional PMI typically wins for credit scores 720+; FHA MIP wins for scores under 680. The breakdown for a 5% down borrower in 2026: conventional PMI at 720 FICO ≈ 0.50% of loan/year (cancels at 78% LTV); FHA MIP ≈ 0.55% of loan/year for the life of the loan plus a 1.75% upfront premium. Over a 10-year hold, conventional saves $4,000-$8,000 PMI on a $300K loan because PMI auto-cancels but MIP doesn't. The exception: FHA's lower minimum credit (580 vs 620) and looser DTI rules let weaker-profile borrowers buy at all. Use this calculator to model your conventional PMI, then compare against the FHA vs Conventional comparison tool for the head-to-head decision.

Lender-Paid PMI vs Borrower-Paid PMI vs Single-Premium

Three structures exist: (1) Borrower-paid monthly: standard, included in mortgage payment, cancels at 78% LTV — best when you'll reach 80% LTV within 4-7 years. (2) Single-premium upfront: pay one lump sum at closing (1.5-3.0% of loan) and skip monthly — best when you'll hold the loan 5+ years and don't expect to refinance. Tax-deductible as part of acquisition costs. (3) Lender-paid PMI (LPMI): lender pays the premium and recoups via a higher interest rate (+0.25-0.50%) for the life of the loan — never cancels — best when you'll refinance within 3-5 years. Most borrowers pick monthly because it's the most flexible and cancels automatically. Run all three through this calculator at different time horizons to find your lowest total cost.