PMI calculator

How PMI is calculated

Private mortgage insurance protects the lender, not you, if a conventional loan with less than 20% down goes bad. You pay for it, usually as a monthly charge added to your mortgage payment. Insurers price it as a yearly percentage of the loan amount, set by two things above all: how much you put down and your credit score. The monthly charge is:

PMI per month = loan amount × annual PMI rate ÷ 12

On the most common monthly plan the charge is figured on the original loan amount and stays the same for the first ten years, then it can drop. Here is the calculator's opening example:

1. 1

   Find the loan-to-value

   A $400,000 home with 10% down: $360,000 ÷ $400,000 = 90% LTV. That falls in the 85.01% to 90% band, which takes 25% coverage on a 30-year loan.

2. 2

   Look up the rate

   For a 720 to 739 credit score, one borrower and a debt-to-income ratio under 45%, the rate card gives 0.46% a year.

3. 3

   Turn it into dollars

   $360,000 × 0.0046 = $1,656 a year, or $138 a month, on top of $2,453.39 of principal and interest at 7.24%.

4. 4

   Find the end dates

   80% of $400,000 is $320,000; the scheduled balance gets there after payment 103 (8 years 7 months). 78% is $312,000, reached after payment 118 (9 years 10 months).

5. 5

   Add it up

   118 months × $138 = $16,284 if PMI runs to the automatic end, or $14,214 if you ask to cancel at 80%.

Our mortgage calculator uses a flat 0.50% as a placeholder for the same loan ($150 a month). The rate card puts that loan between the 720 and 700 credit tiers (0.46% and 0.55%), so the two pages agree within the range a real quote would show.

What PMI costs by credit score and down payment

Annual rates for a 30-year fixed loan, one borrower, debt-to-income of 45% or less, standard coverage, from a national insurer's published card. At 0.46% a year, each $100,000 borrowed costs $38.33 a month.

Two lessons stand out. Credit matters more than people expect: at 5% down, a 620 score pays nearly four times what a 760 score pays. And the bands have edges. Going from 9.5% to 10% down, or from 14.5% to 15%, drops you into a cheaper row. If you are close to an edge, ask the lender to price both. These rates fall within Freddie Mac's rule of thumb of $30 to $150 a month per $100,000, about 0.36% to 1.8% a year, for most borrowers; the best-credit, 15%-down cases come in below it. Other insurers price differently, and your lender picks the insurer, so treat this as a realistic guide, not a quote.

When PMI ends: 80%, 78% and the midpoint

The Homeowners Protection Act of 1998 sets the rules for most loans on a primary home closed on or after July 29, 1999. "Original value" means the lower of the purchase price or the appraisal when you bought, not today's value.

• 80%: you can ask. Request cancellation in writing once your balance is scheduled to reach 80% of original value, or sooner if extra payments get you there. You need a good payment history, no second mortgage, and the servicer can ask for proof the home has not lost value, such as an appraisal.
• 78%: it ends on its own. When the scheduled balance hits 78% of original value and you are current, the servicer must drop PMI. The date is on your PMI disclosure. Extra payments do not move this date, because it follows the original schedule; they move the 80% request date instead.
• Midpoint: final stop. PMI must end the month after the halfway point of the loan term (15 years on a 30-year loan) if you are current, even if 78% has not been reached.

Fannie Mae and Freddie Mac loans can go further. Fannie Mae lets a borrower cancel based on the home's current value: the loan must be at 75% or less of current value if it is two to five years old, or 80% or less after five years, with no payment 30 days late in the last 12 months and none 60 days late in the last 24. If prices have risen or you remodeled, an appraisal can end PMI years early. In the example, $200 a month of extra principal (try it in the calculator) moves the 80% date from 8 years 7 months to 5 years 8 months. Our mortgage payoff calculator shows what the same extra does to the whole loan.

PMI vs. FHA mortgage insurance

FHA loans carry their own insurance, the mortgage insurance premium (MIP), set by HUD rather than by private insurers. It works differently:

• Upfront premium: 1.75% of the base loan, usually added to the loan. On $360,000 that is $6,300.
• Annual premium: for loans over 15 years up to $726,200, 0.50% a year at 95% LTV or below and 0.55% above 95% (0.70% and 0.75% for larger loans). For 15-year loans, 0.15% at 90% LTV or below and 0.40% above. It is charged monthly and recalculated each year on the scheduled average balance.
• How long: 11 years if you put down at least 10%. With less than 10% down, it lasts for the life of the loan; the usual way out is to refinance into a conventional loan later.

In the example, FHA costs about $25,084 in all ($6,300 upfront plus $18,784 of annual premium over 11 years) against $16,284 of PMI. At 3.5% down with a 720 score, PMI runs about $35,576 before it ends in year 13, while FHA charges $6,755 upfront and annual premium for 30 years. FHA can still win: it accepts lower credit scores, its rates are often lower than conventional rates, and its premium does not rise as steeply for scores in the 600s. Compare full Loan Estimates, not just the insurance line. Our down payment calculator shows the cash each option needs, and the home affordability calculator shows how the insurance changes the price you can afford.

Ways to pay less, or nothing

• 20% down. No PMI on a conventional loan. Weigh it against keeping cash for repairs and emergencies.
• Raise your score before you apply. Moving up one tier at 10% down saves $25 to $40 a month on $360,000.
• Add a co-borrower. Two or more borrowers get a small discount on most rate cards, but every borrower's credit counts.
• Lender-paid MI. The lender pays the insurance and charges a higher rate. It never cancels, because it is built into the rate.
• Piggyback loan (80-10-10). A second mortgage covers part of the down payment. No PMI, but the second loan usually has a higher rate.
• VA loans have no monthly mortgage insurance, only a one-time funding fee, for eligible veterans and service members.

Sources and assumptions

• PMI rates: Arch Mortgage Insurance Company, Borrower-Paid Monthly, Non-Refundable Annualized BPMI Rates, effective February 9, 2026: fixed-rate loans, standard coverage, terms over 20 years and 20 years or less; adjustments for more than 45% DTI and two or more borrowers; minimum rate 0.14%. After year 10 the rate drops to the lower of the original rate or 0.20%, as on that card's constant-renewal plan. Rates need state approval and vary by insurer; scores under 620, cash-out refinances, second homes, investment and 2-4 unit properties are not modeled.
• Standard coverage by LTV: Fannie Mae Selling Guide, B7-1-02, Mortgage Insurance Coverage Requirements: 12%, 25%, 30% and 35% over 20 years; 6%, 12%, 25% and 35% for 20 years or less.
• Cancellation rules: Consumer Financial Protection Bureau, When can I remove PMI from my loan? (reviewed August 28, 2026), summarizing the Homeowners Protection Act. Current-value cancellation: Fannie Mae Servicing Guide, B-8.1-04, Termination of Conventional Mortgage Insurance.
• Typical range: Freddie Mac, The Math Behind Putting Down Less Than 20% (last reviewed June 6, 2025): $30 to $150 a month per $100,000 borrowed.
• FHA premiums: HUD Mortgagee Letter 2023-05 (for case numbers endorsed on or after March 20, 2023): 1.75% upfront; annual MIP and its 11-year or life-of-loan duration as listed above. The FHA side assumes the upfront premium is financed and uses the same rate unless you change it. FHA loan limits by county are not checked.
• Default interest rates: Freddie Mac, Primary Mortgage Market Survey, week of October 29, 2026: 30-year fixed 7.24%, 15-year fixed 6.60%.
• This calculator is an educational estimate. It is not an insurance quote, an offer of credit or financial advice. Speak with a licensed lender or a HUD-approved housing counselor. Rates checked October 29, 2026.

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