Estimate monthly PMI cost based on loan amount and PMI rate, and see when it auto-terminates.
Monthly PMI
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Annual PMI cost
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Auto-terminate (78% LTV)
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Removable by request (80% LTV)
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Total PMI paid until auto-terminate
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What PMI actually costs each month
Private mortgage insurance protects the lender, not you, when you put down less than 20 percent on a conventional loan. It does not pay your mortgage if you lose your job. It simply covers the lender's loss if they have to foreclose while your equity is thin. You pay for that protection until your loan balance falls far enough that the lender no longer needs it. This tool prices that monthly charge and, more usefully, tells you when it disappears.
The monthly premium is the annual PMI rate multiplied by the loan amount, divided by twelve. The rate itself is set by the loan-to-value ratio (LTV) and your credit score. A borrower with a 780 score and a 5 percent down payment might see 0.3 percent, while a 660 score at the same down payment can push past 1.2 percent. That spread is the single biggest lever on your premium, and it is why I tell clients to pull their credit before locking a rate, not after.
Tracing PMI on a $380,000 loan
Take the default scenario: a $420,000 home with a $380,000 loan, which is a 90.5 percent LTV. At a 0.7 percent annual PMI rate, the premium is $380,000 times 0.007, or $2,660 a year, which is $222 a month. That $222 rides on top of your principal and interest until the balance falls. Because the loan amortizes on a 30-year, 6.5 percent schedule, the calculator walks the balance down month by month and flags the two moments that matter.
| Step | Figure |
|---|---|
| Loan amount | $380,000 |
| Annual PMI rate | 0.7% |
| Annual premium | $2,660 |
| Monthly premium | $222 |
| Reach 80% LTV (you can request) | Month 98, about 8.2 years |
| Reach 78% LTV (auto-terminate) | Month 112, about 9.3 years |
| Total PMI paid if you wait for auto-drop | $24,827 |
Letting it run to automatic termination costs nearly $24,827 on this loan. Acting at the 80 percent request point, fourteen months earlier, saves roughly $3,100 in premiums you would otherwise hand the insurer for no benefit.
Why the rate input matters more than you think
Run the same loan at 0.4 percent instead of 0.7 percent and the monthly premium drops to about $127. Over the eight-plus years until you can cancel, that is a difference of more than $9,000. Lenders do not always volunteer their best PMI quote, and on a single-premium or lender-paid structure the cost is baked into your rate where you cannot see it. Ask for the borrower-paid monthly option in writing so you can compare it cleanly and cancel it later.
The 80% request vs the 78% auto-drop
The Homeowners Protection Act gives you two distinct rights. At 80 percent of the original value you may request cancellation, but the servicer can require a good payment history and an appraisal. At 78 percent the servicer must drop it automatically with no action from you, provided you are current. The fourteen-month gap in our example is real money, so the practical move is to mark month 98 on your calendar and send the written request.
Two ways to kill it faster
First, prepay principal. Every extra dollar toward principal pulls the 80 percent date forward, and on a thin-equity loan the early payments make outsized progress because the balance is what the threshold tracks. Second, get a new appraisal if your area has appreciated. If the $420,000 home is now worth $475,000, your $380,000 balance is already under 80 percent of current value, and most servicers will cancel on a borrower-paid appraisal that confirms it. This is the most common mistake I see: homeowners wait years for amortization to do the work when a $500 appraisal would have ended PMI in a hot market.
One caveat the tool does not model: FHA loans are different. FHA mortgage insurance premiums often run for the life of the loan when the down payment is under 10 percent, and the only exit is a refinance into a conventional loan. If you are on an FHA mortgage, the cancellation timeline here does not apply to you, and refinancing is usually the lever.
Does PMI ever come back after it is removed?
No. Once a conventional servicer cancels or terminates PMI based on your equity, it is gone for that loan even if home values later fall. The threshold is measured against your original value (or a fresh appraisal at the time of request), not against a moving market price. A new loan, such as a cash-out refinance that pushes you back above 80 percent LTV, can trigger new PMI, but the original charge does not return.
Is PMI tax deductible?
The mortgage insurance premium deduction expired after the 2021 tax year and has not been extended for 2025 or 2026 returns. For most homeowners PMI is now a pure cost with no federal write-off, which is one more reason to cancel it as early as the rules allow rather than treating it as a deductible expense.