PMI Calculator - Calculate Private Mortgage Insurance Cost
Calculate your monthly PMI cost and find out when you can remove it. See how PMI affects your monthly payment and total loan cost.
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Loan Amount vs 80% LTV Threshold
What is PMI?
PMI (Private Mortgage Insurance) protects the lender if you default on your loan. Required for conventional loans with less than 20% down payment (LTV > 80%). Cost: 0.5-1.5% of loan amount annually. Example: $300,000 loan at 1% PMI = $3,000/year = $250/month. PMI does NOT protect you — only the lender.
When is PMI Required?
PMI is required when LTV > 80% on conventional loans. LTV 81-90%: Moderate PMI rates (0.5-1.0%). LTV 91-95%: Higher PMI rates (0.8-1.2%). LTV 95%+: Highest PMI rates (1.0-1.5%). Your credit score also affects PMI rates — higher credit score = lower PMI. VA loans never require PMI.
How to Remove PMI
Automatic removal: PMI cancels automatically at 78% LTV (based on original value). Request removal: You can request removal at 80% LTV (may require appraisal, $300-500 cost). Refi to remove: Refinance when home value increases enough to reach 80% LTV. Pay extra principal to reach 80% faster. Good payment history required (no late payments in past 12 months).
PMI vs FHA MIP - Key Differences
Conventional PMI: Removable at 78-80% LTV, 0.5-1.5% rate, based on LTV and credit score. FHA MIP: Lifetime MIP if <10% down, 0.55% rate (most common), upfront MIP 1.75% + annual. FHA MIP is much harder to remove — often requires refinance to conventional loan. PMI is better if you can qualify for conventional loan.
Cost of PMI Over Time
Example: $300,000 loan at 1% PMI = $3,000/year. If it takes 5 years to reach 80% LTV, you'll pay $15,000 total in PMI. If it takes 10 years, $30,000! This is why 20% down is recommended — avoiding PMI saves thousands. Every extra principal payment speeds up PMI removal.
Strategies to Avoid or Minimize PMI
Put 20% down to avoid PMI entirely. Piggyback loan (80-10-10): 80% first mortgage + 10% second mortgage + 10% down = no PMI. Lender-paid PMI: Higher rate instead of monthly PMI (can't remove later). Pay extra toward principal from day one to reach 80% faster. Use gift money to increase down payment to 20%.
Is PMI Tax Deductible?
PMI is generally NOT tax deductible as of 2025 (deduction expired Dec 31, 2021). It was temporarily deductible in some years, but that provision has not been renewed. FHA MIP is also not deductible. Interest on your mortgage IS deductible (if you itemize), but PMI is not. Another reason to eliminate PMI ASAP.
Home Appreciation Can Eliminate PMI Faster
If your home value increases, your LTV decreases even without paying down principal! Example: Buy for $350K with $315K loan (90% LTV). After 3 years, home worth $400K. New LTV: $315K / $400K = 78.75%. You can request PMI removal! Get a new appraisal ($300-500) to prove increased value. This is how many homeowners eliminate PMI early.
Key Financial Terms
Understand the essential concepts behind this calculator
PMI (Private Mortgage Insurance)
Extra monthly cost added to mortgage if down payment is less than 20% of home value.
LTV (Loan-to-Value Ratio)
The percentage of the loan amount compared to the appraised value of the asset being purchased.
FHA Loan
A government-backed mortgage insured by the Federal Housing Administration, allowing low down payments (as low as 3.5%) and lower credit scores.
Frequently Asked Questions
Common questions about the PMI Calculator - Calculate Private Mortgage Insurance Cost
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⚠️ Important Disclaimer
This PMI Calculator - Calculate Private Mortgage Insurance Cost provides estimates for educational and informational purposes only. Actual results may vary significantly based on individual circumstances, market conditions, regulatory changes, and other factors beyond the scope of this calculator.
The calculations and projections provided are based on assumptions and historical data that may not reflect future performance.Past performance does not guarantee future results.
This tool is not financial advice, tax advice, legal advice, or investment advice. For personalized guidance tailored to your specific situation, please consult with qualified professionals including:
- Certified Financial Planner (CFP)
- Certified Public Accountant (CPA) for tax matters
- Licensed attorney for legal matters
- Registered Investment Advisor (RIA) for investment decisions
Data Accuracy: All data sources, statistics, and rates were verified as accurate as of October 2025. Tax rates, market conditions, and other financial data change over time. Always verify current rates and consult official sources.
No Warranties: While we strive for accuracy, we make no warranties or guarantees regarding the accuracy, completeness, or reliability of any information provided. Use this tool at your own risk.