How much does PMI cost per month?

PMI typically costs 0.2%–1.5% of the loan amount annually, divided by 12 for the monthly payment. On a $315,000 loan at 0.5%, that's $131/month. The exact rate depends on your credit score, LTV ratio, and loan type.

When does PMI automatically cancel?

Under the Homeowners Protection Act, PMI automatically cancels when your loan balance reaches 78% of the original purchase price (80% LTV on request). This typically takes 8–11 years on a 30-year mortgage with a 10% down payment.

Can I remove PMI early?

Yes. You can request PMI cancellation once your balance reaches 80% LTV based on original purchase price. If your home has appreciated, you may be able to get a new appraisal and request removal even sooner, though lender policies vary.

Does PMI protect the buyer or lender?

PMI protects the lender only. If you default, PMI pays the lender for their losses — not you. Despite paying the premiums, the buyer receives no direct benefit from PMI other than being able to qualify for a loan with less than 20% down.

PMI Calculator

Calculate your monthly Private Mortgage Insurance cost based on credit score and LTV, and find out exactly when PMI will drop off your loan.

Home Price

Down Payment

$10.0%

Credit Score Range

Interest Rate

Monthly PMI Cost

$137

0.52% annual PMI rate at 90.0% LTV

Annual PMI

$1,638

LTV Ratio

90.0%

Total PMI Paid

$13,377

PMI Drops Off

Year 9

PMI Rates by Credit Score at 90% LTV

760+ (Excellent)$84/mo (0.32%/yr)

720–759 (Very Good)$137/mo (0.52%/yr)

680–719 (Good)$189/mo (0.72%/yr)

640–679 (Fair)$276/mo (1.05%/yr)

Below 640 (Poor)$341/mo (1.30%/yr)

How to Use This PMI Calculator

Enter four inputs to calculate your Private Mortgage Insurance cost:

PMI Cost Tab

Input your Home Price, Down Payment, Credit Score Range, and Interest Rate. The calculator instantly shows your monthly PMI, annual PMI total, LTV ratio, and total PMI paid over the life of the loan. A comparison table shows how your PMI cost would differ at each credit score tier — useful if you're considering ways to improve your score before buying.

PMI Removal Timeline Tab

This tab shows a year-by-year amortization table with your LTV and PMI status for each year. Watch as your LTV drops below 80% and PMI switches from "Active" to "Cancelled." You'll also see the exact year PMI drops off and total PMI cost before that point.

How PMI Rates Are Calculated

Monthly PMI = (Loan Amount × Annual PMI Rate) ÷ 12

Annual PMI Rate depends on:
• LTV ratio (Loan-to-Value = Loan ÷ Home Price × 100)
• Credit score range
• Loan type (conventional vs. FHA)

Example PMI Rate Table (Conventional Loans):
Credit Score | LTV 85-90% | LTV 90-95%
760+ | 0.32% | 0.46%
720-759 | 0.52% | 0.70%
680-719 | 0.72% | 0.95%
640-679 | 1.05% | 1.25%

FHA loans use a different insurance system called MIP (Mortgage Insurance Premium), which includes an upfront fee of 1.75% plus an annual premium of 0.55%–1.05%. Unlike conventional PMI, FHA MIP typically lasts the full loan term if down payment is under 10%.

Example: PMI on a $315,000 Loan

James buys a $350,000 home with 10% down — Phoenix, AZ

James has a 720 credit score and puts 10% down ($35,000), leaving a $315,000 loan at 91% LTV.

Home Price	$350,000
Down Payment (10%)	$35,000
Loan Amount	$315,000
LTV Ratio	90%
Credit Score	720–759
PMI Rate	0.70% annual
Monthly PMI	$184/month
Annual PMI	$2,205/year
PMI Drops Off	Year 9 (after ~$20,000 in PMI)
PMI Savings After Removal	$184/month freed up

If James improved his credit score to 760+, his PMI rate would drop to 0.46%, saving him $74/month and roughly $6,000 over the PMI period. Alternatively, putting down 20% ($70,000) eliminates PMI entirely — but requires $35,000 more upfront.

Frequently Asked Questions

PMI (Private Mortgage Insurance) is required on conventional loans when your down payment is less than 20% of the home price — in other words, when your LTV ratio exceeds 80%. It protects the lender, not you, in case you default. PMI does not replace homeowners insurance. For FHA loans, a similar product called MIP (Mortgage Insurance Premium) applies regardless of down payment size.

PMI typically costs 0.2%–1.5% of the original loan amount annually, divided by 12 for the monthly payment. A borrower with excellent credit (760+) at 85% LTV might pay 0.32% ($89/month on a $315,000 loan), while a borrower with fair credit (640–679) at 95% LTV might pay 1.4% ($368/month on the same loan). The exact rate depends on your credit score, LTV ratio, loan type, and lender.

Under the federal Homeowners Protection Act of 1998, lenders must automatically cancel PMI when your loan balance reaches 78% of the original purchase price (not current value). You can request cancellation once you reach 80% LTV. The time this takes depends on your down payment: starting at 10% down, PMI typically cancels around year 8–10 on a 30-year loan without extra payments.

Yes, in several ways. (1) Make extra principal payments to reach 80% LTV faster. (2) If your home has appreciated, get a new appraisal and request removal based on current market value — most lenders allow this after 2 years with good payment history. (3) Refinance into a new loan without PMI if your new LTV is 80% or below. Contact your lender directly to initiate the cancellation process.

PMI protects the lender only. If you default on your mortgage, PMI compensates the lender for their losses — you receive nothing. You pay the premium, but the lender receives the benefit. This is different from homeowners insurance, which protects your property. Despite this, PMI serves a useful purpose for buyers: it allows you to purchase a home with less than 20% down by reducing the lender's risk.