Estimate Your PMI and Monthly Payment
Use this primary mortgage insurance calculator to estimate monthly PMI, your loan-to-value ratio (LTV), and the month PMI may cancel.
What is primary mortgage insurance (PMI)?
Primary mortgage insurance, often called PMI, is insurance that protects the lender when a borrower puts less than 20% down on a conventional home loan. It does not protect the borrower directly, but it can make homeownership possible sooner by lowering upfront cash requirements.
In plain language: if your down payment is smaller, your lender takes more risk. PMI is the extra monthly cost that helps offset that risk.
How this calculator works
This calculator estimates your monthly PMI and combines it with your principal and interest payment, taxes, insurance, and HOA dues to give a fuller monthly housing payment view.
- Loan amount = Home price − down payment
- LTV (loan-to-value) = Loan amount ÷ home price
- Monthly PMI = Loan amount × annual PMI rate ÷ 12
- P&I payment = Standard amortized mortgage payment formula
When PMI is usually required
PMI is commonly required when down payment is below 20% on a conventional mortgage. If your down payment is 20% or more, PMI is typically not required.
What affects your PMI rate?
PMI rates vary by lender and borrower profile. Common factors include:
- Credit score
- Down payment size
- Loan term (e.g., 30-year vs. 15-year)
- Occupancy type (primary home vs. investment property)
- Loan size and program details
A lower annual PMI rate (for example 0.35%) can significantly reduce monthly cost versus a higher rate (for example 1.00%+), so quote shopping matters.
How to remove PMI faster
With many conventional loans, PMI can be removed when your balance reaches a qualifying LTV threshold, often around 80% by request and 78% automatically under certain conditions.
Strategies to reach PMI cancellation sooner
- Make extra principal payments each month
- Make one additional payment each year
- Refinance when your home value rises and equity increases
- Avoid rolling high fees into the loan balance when possible
PMI vs. FHA mortgage insurance (MIP)
PMI applies to most conventional loans with low down payments. FHA loans use a different system called MIP (mortgage insurance premium), which includes upfront and annual components and follows different cancellation rules.
If you are comparing loan programs, do not assume PMI and MIP are interchangeable. The long-term total cost can differ substantially.
Example scenario
Suppose you buy a $400,000 home with 10% down ($40,000). Your loan is $360,000. If your annual PMI rate is 0.55%, PMI is about $165 per month before other escrow items. Add principal, interest, taxes, insurance, and HOA dues to estimate true monthly housing cost.
Common mistakes first-time buyers make
- Budgeting only for principal + interest and forgetting taxes and insurance
- Assuming PMI lasts forever (often it can be canceled)
- Not comparing PMI rate quotes from multiple lenders
- Ignoring the impact of credit score improvements before applying
Final takeaway
A primary mortgage insurance calculator helps you understand affordability with much better clarity than a basic mortgage payment estimate. Use it early in your home search, then verify exact numbers with your lender before locking your loan.