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PMI calculator
Put less than 20% down and you pay private mortgage insurance: a monthly cost that protects the lender, not you. See what it costs, when it drops off, and the total you'll pay before it does.
At 10% down your loan starts at 90% of value, so PMI applies until the balance reaches 78%: about 112 payments. You'll pay roughly $21,420 in total before it cancels.
How PMI works
cancels when the balance reaches 78% of the original price
Private mortgage insurance is the price of a small down payment. It reimburses the lender if you default, which is why it buys you nothing directly, but it's what makes a 3-to-15% down purchase possible at all. On a conventional loan it isn't permanent: it cancels automatically once you've paid the balance down to 78% of the original value, and you can request removal at 80%. Paying extra principal accelerates that date, and so does appreciation, since either can be used to prove you've crossed the equity line.
PMI vs. a bigger down payment
Putting 20% down avoids PMI entirely, but ties up more cash. For an investor, that trade-off is a real decision: the PMI is a drag on cash flow, but the freed-up capital might fund a second down payment. This calculator quantifies the cost so you can weigh it rather than assume.
PMI questions
What is PMI and when do I pay it?
Private mortgage insurance protects the lender when you put down less than 20 percent on a conventional loan. You pay it monthly until you reach 20 to 22 percent equity, at which point it can be removed. It protects the lender, not you, which is exactly why avoiding or shedding it quickly matters.
How do I get rid of PMI?
It's automatically cancelled when the loan balance reaches 78 percent of the original value, and you can request removal at 80 percent. Paying extra principal, or appreciation that lifts your equity above the line, gets you there sooner: sometimes years sooner than the scheduled date.
How much does PMI cost?
Typically 0.3 to 1.5 percent of the loan amount per year, depending on your credit score and down payment size. On a $340,000 loan at 0.6 percent that's about $170 a month. Real money that buys nothing but the ability to put less down.
Every calculator
See PMI inside the whole payment.
Faro folds PMI into cash flow and shows when it drops: paste a listing for the full picture.
Estimates for analysis and educational use only: not financial, investment, tax, or legal advice. Verify every number independently before making a purchase decision.