What This Calculator Does
Private mortgage insurance (PMI) is required on conventional loans when your down payment is less than 20% of the home price. It protects the lender, not you, if you default on the loan. This calculator estimates your PMI cost based on your credit score, down payment, loan amount, and interest rate. It also projects when your PMI will automatically cancel based on principal paydown and home price appreciation.
PMI is not the same as the mortgage insurance premium (MIP) on FHA loans. The key difference: conventional PMI cancels automatically when your loan-to-value ratio reaches 78%, while FHA MIP on loans with less than 10% down lasts the entire loan term. If you have a credit score above 680, conventional PMI is usually cheaper than FHA MIP over the life of the loan. Compare both options using our FHA Loan Calculator and our Mortgage Calculator.
2026 PMI Rate Matrix
PMI rates are set by private mortgage insurance companies (MGIC, Radian, Essent, Arch MI, National MI, and Enact) and vary based on your credit score, loan-to-value ratio, loan term, and property type. The table below shows representative 2026 annual PMI rates for 30-year fixed conventional loans on single-family primary residences.
| Credit Score | LTV 80-85% | LTV 85-90% | LTV 90-95% | LTV 95-97% |
|---|---|---|---|---|
| 760+ | 0.19% | 0.25% | 0.41% | 0.51% |
| 740-759 | 0.22% | 0.32% | 0.50% | 0.62% |
| 720-739 | 0.26% | 0.38% | 0.58% | 0.73% |
| 700-719 | 0.34% | 0.50% | 0.78% | 0.97% |
| 680-699 | 0.43% | 0.62% | 0.98% | 1.20% |
| 660-679 | 0.54% | 0.78% | 1.15% | 1.40% |
| 640-659 | 0.61% | 0.91% | 1.30% | 1.55% |
| 620-639 | 0.79% | 1.22% | 1.70% | 1.86% |
Annual PMI rate as percentage of loan amount. Source: Urban Institute 2026 PMI data via Bankrate, cross-referenced with MGIC and Radian published rate cards. Individual quotes vary by lender and property type.
Inputs Required
- Home Price: The purchase price of the home.
- Down Payment: The percentage of the home price you pay upfront. PMI is required when this is below 20%.
- Credit Score: Your FICO score. The calculator uses tiers from 620 to 850. Higher scores get significantly lower PMI rates.
- Interest Rate: Your mortgage interest rate. As of September 3, 2026, the 30-year fixed rate averaged 6.71% per Freddie Mac.
- Loan Term: 15, 20, or 30 years. Shorter terms build equity faster, which cancels PMI sooner.
- Home Appreciation: Estimated annual home price growth. This affects how quickly your LTV drops to 78%.
How the Calculation Works
The PMI calculation is straightforward once you know your rate:
LTV = (Loan Amount / Home Price) x 100
Annual PMI = Loan Amount x PMI Rate
Monthly PMI = Annual PMI / 12
The PMI rate is looked up from the rate matrix using your credit score tier and LTV band. For example, a borrower with a 740 credit score and 10% down (90% LTV) on a $400,000 home has a loan amount of $360,000. The PMI rate for the 740-759 tier at 85-90% LTV is 0.32%. Annual PMI is $360,000 x 0.0032 = $1,152. Monthly PMI is $96.
The cancellation projection simulates monthly principal paydown and home appreciation until the loan-to-value ratio reaches 78%. At that point, the Homeowners Protection Act of 1998 requires the lender to automatically cancel PMI. You can also request PMI removal at 80% LTV with proof of property value (typically an appraisal).
How to Use the Calculator
- Enter your home price and select your down payment percentage.
- Set your credit score using the slider. The calculator shows which credit tier you fall into.
- Enter your expected interest rate. Check current rates with your lender or on Freddie Mac's PMMS.
- Choose your loan term (15, 20, or 30 years).
- Adjust the home appreciation estimate if you expect faster or slower price growth.
- Review your monthly PMI cost, annual cost, and estimated cancellation date.
- Compare the total PMI cost against putting 20% down or using an FHA loan with our Down Payment Calculator.
Example Calculations
Example 1: Strong Credit, 10% Down
David, a software engineer in Denver, buys a $500,000 home with 10% down and a 760 credit score on a 30-year fixed at 6.71%:
- Down payment: $50,000
- Loan amount: $450,000
- LTV: 90.0%
- PMI rate (760+ tier, 85-90% LTV): 0.25%/yr
- Annual PMI: $1,125
- Monthly PMI: $93.75
- Monthly P&I at 6.71%: $2,910
- Total monthly with PMI: $3,004
- Estimated PMI cancellation: approximately year 4-5 (with 3% appreciation)
- Total PMI paid: approximately $4,500 to $5,600
David's strong credit score keeps his PMI low. With 3% annual appreciation, his LTV drops to 78% in about 4 years, and PMI cancels automatically. His total PMI cost is modest compared to the interest savings from buying now rather than waiting years to save 20% down.
Example 2: Fair Credit, 5% Down
Maria, a teacher in Phoenix, buys a $350,000 home with 5% down and a 660 credit score on a 30-year fixed at 6.71%:
- Down payment: $17,500
- Loan amount: $332,500
- LTV: 95.0%
- PMI rate (660-679 tier, 90-95% LTV): 1.15%/yr
- Annual PMI: $3,824
- Monthly PMI: $318.64
- Monthly P&I at 6.71%: $2,149
- Total monthly with PMI: $2,468
- Estimated PMI cancellation: approximately year 8-9 (with 3% appreciation)
- Total PMI paid: approximately $30,000 to $34,000
Maria's lower credit score and smaller down payment produce a PMI rate nearly 5 times higher than David's. She pays over $300 per month in PMI alone. If Maria can improve her credit score to 720 before buying, her PMI rate drops to 0.58%, saving her about $160 per month and roughly $15,000 over the PMI period. She uses our Debt-to-Income Ratio Calculator to check how the PMI affects her qualification.
Real-World Scenarios
The 80-10-10 Piggyback Alternative
Jennifer buys a $600,000 home with 10% down. Instead of paying PMI on a $540,000 conventional loan, she takes out a $480,000 first mortgage (80% LTV, no PMI) and a $60,000 second mortgage (HELOC or home equity loan) at a higher rate. The first mortgage at 6.71% costs $3,107/month. The second mortgage at 8.5% over 20 years costs $520/month. Total: $3,627. A single loan with PMI at 0.32% (740 credit) costs $3,491 + $144 PMI = $3,635. The piggyback saves $8/month initially, but the second mortgage must be paid off separately. If home values rise, Jennifer can refinance or pay off the second mortgage to eliminate the higher-rate debt. This strategy works best when PMI rates are high (lower credit scores) and second mortgage rates are reasonable.
Requesting Early PMI Removal at 80% LTV
The Thompson family bought a $400,000 home with 5% down and a 700 credit score. Their PMI is 0.78% per year, or $234/month on a $380,000 loan. After 3 years, rapid appreciation in their area pushes the home value to $475,000. Their loan balance is $358,000, giving an LTV of 75.4%. They request PMI removal at 80% LTV with a new appraisal showing the higher value. The lender removes PMI, saving them $234/month ($2,808/year). They did not have to wait for the automatic 78% cancellation, which would have taken several more years based on principal paydown alone. The appraisal cost $500, which pays for itself in less than 2 months of PMI savings.
Refinancing to Eliminate PMI
Carlos has a $350,000 loan at 6.71% with PMI of $189/month (0.65% rate, 680 credit score). After 4 years, his credit score improved to 740 and his home appreciated to $480,000. His LTV is now 68%. He refinances at 6.50% (rates dropped slightly) with no PMI. His new payment on $325,000 at 6.50% for 26 years is $2,068, compared to his old payment of $2,266 + $189 PMI = $2,455. He saves $387/month. He uses our Refinance Calculator to verify the break-even on closing costs.
Why This Calculation Matters
PMI can add $50 to $500 or more to your monthly mortgage payment, depending on your loan size, credit score, and down payment. On a $400,000 loan with 5% down and a 680 credit score, PMI costs about $3,920 per year. Over the 7 to 9 years it typically takes to reach 78% LTV, that is $27,000 to $35,000 in insurance premiums that protect the lender, not you.
Understanding your PMI cost before you buy helps you make better decisions. A 60-point credit score increase (from 660 to 720) can cut your PMI rate in half. Saving an extra 5% for a down payment moves you to a lower LTV band with a cheaper rate. And knowing your cancellation timeline tells you exactly when that monthly cost will disappear. The 30-year fixed mortgage rate averaged 6.71% as of September 3, 2026 per Freddie Mac, so every dollar of PMI on top of that rate increases your effective borrowing cost.
Common Mistakes to Avoid
- Not knowing your credit score before shopping: PMI rates have steep cliffs at certain score thresholds. The jump from 679 to 680 and from 719 to 720 can save you $100+ per month. Check your score and improve it before applying if you are near a tier boundary.
- Assuming PMI is permanent: PMI auto-cancels at 78% LTV by federal law. You can request removal at 80% LTV with an appraisal. Do not pay PMI longer than necessary. Track your LTV and contact your lender when you reach 80%.
- Confusing PMI with FHA MIP: Conventional PMI cancels. FHA MIP on loans with less than 10% down does not cancel and lasts the full loan term. If your credit is above 680, compare conventional PMI against FHA MIP carefully. The FHA MIP may cost more over the life of the loan.
- Ignoring lender-paid PMI (LPMI): Some lenders offer lender-paid PMI, where they pay the insurance and charge you a slightly higher interest rate instead. This eliminates the separate PMI payment but the higher rate lasts forever. Run the numbers: LPMI is usually worse if you plan to stay long enough for PMI to cancel.
- Forgetting about appraisal costs for early removal: Requesting PMI removal at 80% LTV typically requires a new appraisal ($400 to $700). Factor this cost into your decision, but it usually pays for itself within 1 to 2 months of PMI savings.
Limitations of This Calculator
This calculator uses representative 2026 PMI rates averaged across multiple insurers. Your actual rate may differ based on your specific lender, the insurer they use, loan type (purchase vs refinance), occupancy (primary vs second home vs investment), and property type (single-family vs condo). The cancellation projection assumes steady monthly payments and constant appreciation. It does not account for extra principal payments, rate changes on ARMs, or home value fluctuations. The Homeowners Protection Act cancellation rules apply to conventional loans originated after July 29, 1999. This tool does not constitute a loan quote or PMI rate quote. Contact a licensed mortgage lender for an official estimate.
Authoritative Research & Resources
- Consumer Financial Protection Bureau: What is PMI? - The CFPB's official guide to private mortgage insurance, covering how it works, when it is required, and your rights under the Homeowners Protection Act of 1998 for automatic cancellation at 78% LTV and borrower-requested removal at 80% LTV.
- Freddie Mac Primary Mortgage Market Survey - Weekly mortgage rate data used as the default interest rate in this calculator. As of September 3, 2026, the 30-year fixed rate averaged 6.71%. PMI is added on top of this rate, so knowing the current rate environment helps you estimate your true monthly housing cost.
- Urban Institute Housing Finance Policy Center - Research on PMI pricing, market share, and the conventional vs FHA trade-off. Their data shows that conventional PMI typically wins for borrowers with credit scores above 720, while FHA MIP is cheaper for scores below 680.
- MGIC Rate Manual - One of the largest private mortgage insurers publishes its national rate card, which is the source for many of the PMI rates used in this calculator. Your lender will look up your exact rate on a similar card from whichever insurer they use.