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Private Mortgage Insurance (PMI)

Wondering how much extra you’ll pay if your down payment is under 20%? The Private Mortgage Insurance (PMI) Calculator helps you estimate the monthly cost of PMI and understand its impact on your overall mortgage payment—so you can plan smarter and buy confidently.




PMI Calculator

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Monthly PMI: $0.00

Months Until PMI Cancellation: 0

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What is Private Mortgage Insurance (PMI) Calculator

A Private Mortgage Insurance (PMI) Calculator is a specialized financial tool designed to estimate the additional monthly cost you may incur if your down payment is less than 20% of the home’s purchase price. PMI is a type of insurance that protects lenders in case the borrower defaults on the loan. While it doesn’t benefit the homeowner directly, it allows buyers to qualify for a mortgage with a lower upfront investment.

This calculator is especially helpful for first-time homebuyers or those with limited savings, as it shows the true cost of buying with less than 20% down. It also helps users understand when PMI might fall off and what’s needed to avoid it altogether.




How it works

Private Mortgage Insurance (PMI) Calculator Works

The PMI Calculator works by taking several key pieces of information: the home’s purchase price, your down payment amount, loan term, and interest rate. Once these values are entered, the calculator determines the loan-to-value (LTV) ratio—a critical factor lenders use to assess whether PMI is required. If your LTV is over 80%, PMI is typically applied, and the calculator estimates the monthly insurance premium based on current PMI rate ranges, which usually fall between 0.3% and 1.5% of the loan amount annually.

The tool then divides that annual cost into monthly payments and adds it to your projected mortgage payment. It also gives you an estimate of when you might reach 20% equity—at which point PMI can potentially be canceled. This insight helps borrowers budget more accurately and make informed decisions about whether to increase their down payment or accept the additional cost of PMI temporarily.



Frequently Asked Questions

What is PMI and why do I have to pay it? Toggle
PMI is insurance that protects the lender if you default on your loan. It’s usually required if your down payment is less than 20%
How long do I have to pay PMI? Toggle
Typically, PMI is removed once your loan-to-value ratio reaches 80%, either through payments or appreciation in home value.
Can I avoid PMI without a 20% down payment? Toggle
Some lenders offer special loan programs or lender-paid PMI options, but these may come with higher interest rates or fees.
Does PMI affect loan approval? Toggle
Not directly. PMI enables more buyers to qualify for a loan by reducing the lender’s risk, especially for those with smaller down payments.
Is PMI tax deductible? Toggle
PMI may be tax-deductible depending on your income and tax laws in your country, but eligibility can change year to year. Consult a tax advisor for specifics.