PMI Calculator: When Can You Stop Paying PMI?

What Is PMI?

Private Mortgage Insurance (PMI) is required by lenders when your down payment is less than 20% of the home's purchase price. It protects the lender (not you) if you default on the loan.

PMI typically costs 0.5% to 1.5% of your loan amount per year, paid monthly. On a $300,000 loan, that's $125-$375/month — or $1,500-$4,500/year.

When Does PMI Go Away?

• Automatic cancellation: Your lender must cancel PMI when your loan-to-value (LTV) ratio reaches 78% based on the original value
• Request cancellation at 80% LTV: You can request removal once you've paid down to 80% of the original value
• Reappraisal: If your home has appreciated significantly, you can get a new appraisal to prove your LTV is below 80%

Example Timeline

For a $400,000 home with 10% down ($40,000):

• Loan amount: $360,000
• 80% of home value: $320,000
• You need to pay down: $40,000 in principal
• At 6.5% interest, 30-year term: PMI drops around year 7-8
• Total PMI paid: approximately $12,600-$25,200

How to Drop PMI Faster

1. Make extra principal payments — even $100/month extra can save years of PMI
2. Get a reappraisal if your market has appreciated 10%+ since purchase
3. Refinance if rates drop and your equity has grown

Calculate Your PMI Timeline

Use our Mortgage Calculator to see your full amortization schedule and identify exactly when your LTV hits 80%. Our Home Affordability Calculator also shows PMI costs in your monthly payment breakdown.