PMI calculator
What mortgage insurance costs on a low-deposit loan, and when the balance reaches the level at which it can be cancelled.
Estimated PMI each month
Estimate$129.00
90.0% loan-to-value, above the 80% threshold
- Months until you can request removal
- 95 months
- Months until automatic termination
- 109 months
- Cost of not asking at 80%
- $1,808.00
| Home price | $420,000 |
|---|---|
| Deposit | -$42,000 |
| Loan amount | $378,000 |
| Loan-to-value | 90% |
| Annual premium | $1,550.00 |
| Total paid before you could cancel | $12,269 |
- The premium is an indicative estimate. Actual rates are set by the insurer and depend on credit score, loan type and term — ask your lender for the quoted figure.
- Cancellation is measured against the original purchase price, not the current market value, so a rising market does not remove PMI any faster.
On $420,000 with 10% down the loan-to-value is 90%, so insurance applies until the balance reaches $336,000, the 80% mark.
Over the life of it
How this is calculated
Insurance ends at a loan-to-value threshold
Lenders require it above roughly 80% loan-to-value and drop it once the balance falls back through that level. In the US, 80% is a request right and 78% is automatic termination by law.
loan-to-value = balance ÷ original priceAppreciation usually does not help
The threshold is normally measured against the original purchase price rather than current market value, so a home that appreciates 20% cancels no sooner. Paying the balance down to 80% is what removes the premium.
Premiums are insurer-specific
Rates are not published and depend on credit and loan type, running roughly 0.28% to 1.15% of the loan a year across the loan-to-value bands. Treat any calculator figure as indicative and ask your lender for the quote.
Worked example: $420,000 home with $42,000 down at 6.5%
| Price | $420,000 |
|---|---|
| Down payment | $42,000 |
| Loan-to-value | 90% |
|---|---|
| Cancels around | 80% of original price |
Mortgage insurance rules differ by country. Pick a country above for the cancellation rights that apply to your loan.
What this assumes
- A conventional loan with monthly insurance premiums.
- Payments made on schedule with no extra principal.
- Cancellation measured against the original price.
- The premium rate is indicative unless quoted.
Where this commonly goes wrong
- Some loan types carry insurance for the full term regardless of loan-to-value, and only refinancing removes it.
- Lender-paid insurance is priced into a higher rate that never cancels, so it costs more over a long hold.
- Cancellation usually requires the loan to be current, so a late payment near the threshold delays it.
Questions
What is mortgage insurance?
Cover the lender requires when the deposit is below about 20%. It protects the lender, not you, and typically costs between 0.28% and 1.15% of the loan a year depending on the loan-to-value band.
When does it stop?
Once the balance falls back through the threshold — 80% of the original price in the US, where cancellation can be requested, with automatic termination at 78%. Some markets charge a single upfront premium instead.
Can I avoid it?
A larger deposit is the direct route. Alternatives such as a second mortgage or a lender-paid arrangement priced into the rate exist, but each carries a cost that has to be compared against the premiums avoided.
Related tools
Sources
Estimate only, based on published IRS figures for the current period. Not tax or legal advice. Confirm your position with the IRS, a CPA, or an enrolled agent.
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