PMI Calculator
Estimate PMI totals, payments, rates, and costs for financial planning.
This PMI calculator estimates your monthly private mortgage insurance cost - typically required when a down payment is less than 20% of the home's value - and shows roughly when your loan balance will drop low enough to request PMI removal.
Enter your loan amount, home value, and PMI rate, and the calculator returns your estimated monthly PMI cost.
Worked Calculation Examples
| Scenario | Result | Calculation Step |
|---|---|---|
| $300,000 home, 5% down ($285,000 loan), 0.75% PMI rate | $178.13/month | Monthly PMI = ($285,000 × 0.0075) ÷ 12 = $2,137.50 ÷ 12 = $178.13. |
| $300,000 home, 10% down ($270,000 loan), 1.0% PMI rate | $225.00/month | Monthly PMI = ($270,000 × 0.01) ÷ 12 = $2,700 ÷ 12 = $225.00 - a higher PMI rate here (reflecting a smaller loan but higher assumed risk tier) still results in a similar-magnitude payment; the exact rate a lender charges depends on credit score and LTV together, not loan size alone. |
Why PMI Is Required Below 20% Down
PMI protects the lender, not the borrower, against losses if a borrower defaults on a loan with less equity cushion. Lenders typically require it whenever the loan-to-value ratio exceeds 80% (a down payment under 20%), and the annual cost is usually a percentage of the loan amount, split into monthly payments.
When PMI Can Be Removed
PMI can typically be requested for removal once your loan balance reaches 80% of the home's original value, and lenders are generally required to automatically cancel it at 78% under U.S. federal law - paying extra toward principal can accelerate reaching this threshold and eliminate the monthly PMI cost sooner.
How to Use the PMI Calculator
- Open the PMI Calculator and enter the values requested in the input fields.
- Check the units, percentages, dates, or time periods before reading the answer.
- Review the instant result and adjust any value to compare another scenario.
- Use the formula, example, and FAQs below to understand how the pmi calculator works.
Frequently Asked Questions
How is PMI calculated?
PMI is typically an annual rate (commonly 0.5%-1.5% of the loan amount) divided into 12 monthly payments, with the exact rate depending on your credit score, down payment size, and loan type.
When can I stop paying PMI?
You can generally request PMI removal once your loan balance reaches 80% of the home's original value, and lenders must automatically cancel it at 78% under federal law, assuming you're current on payments.
How do I avoid PMI entirely?
The most direct way is making a down payment of 20% or more, though some loan programs offer alternatives like lender-paid mortgage insurance (built into a higher rate) or piggyback second loans.
How do I use this pmi calculator?
Enter the known values, review the units or settings, and the calculator updates the result instantly. The formula and example on this page show how the answer is produced.
What does the PMI Calculator calculate?
Estimate PMI totals, payments, rates, and costs for financial planning. It is designed for fast browser-based calculations without sign-up, downloads, or manual spreadsheet setup.
What formula does this pmi use?
The formula is: Monthly PMI = (Loan Amount × Annual PMI Rate) ÷ 12. PMI protects the lender, not the borrower, against loss if a low-down-payment loan defaults - a protection that became legally codified in the US through the Homeowners Protection Act of 1998, which specifically established the borrower's right to have PMI automatically canceled once the loan balance reaches 78% of the home's original value, addressing a previous practice where some lenders continued charging PMI long after a borrower had built sufficient equity.
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Last updated: September 27, 2026.