What Is PMI and How Do You Get Rid of It?

Published October 12, 2026

Free tool: PMI Calculator→

If you buy a home with less than 20% down on a conventional loan, your lender will usually require private mortgage insurance (PMI). It protects the lender, not you, and it adds to your monthly payment. The good news is that it doesn't last forever. This guide explains what PMI costs and how to get rid of it sooner, using the free PMI Calculator.

What PMI costs

PMI is usually priced as a yearly percentage of the loan, often 0.3% to 1.5% depending on your credit score and down payment, and is added to your monthly payment.

Example: a $400,000 home with $40,000 down (10%) means a $360,000 loan and a starting loan-to-value of 90%. At 6.5% over 30 years with PMI at 0.5% a year:

• Principal and interest: $2,275.44
• PMI: $150.00 a month
• Total: $2,425.44, before property tax and insurance

When PMI ends

Under the US Homeowners Protection Act, borrower-paid PMI on a conventional loan:

• Can be cancelled at your request once the balance reaches 80% of the home's original value, if you're current on payments and meet the lender's requirements.
• Ends automatically when the balance is scheduled to reach 78% of the original value.
• Ends at the latest at the midpoint of the loan's term, as long as you're current.

In the example, you could ask to cancel after 7 years 11 months, having paid $14,250 of PMI. If you wait for it to end automatically, it lasts 9 years 1 month and costs $16,350. Put the earlier date in your calendar: the 78% cut-off is automatic, but cancelling at 80% only happens if you ask.

Get rid of PMI sooner

• Pay extra toward principal. Adding $200 a month in the example lets you ask to cancel after 5 years 4 months, cutting the PMI you pay to $9,600.
• Get a new appraisal if your home's value has risen. Some lenders will remove PMI based on the current value; ask about their rules, which often require a few years of payments.
• Refinance once you have 20% equity, but only if the new rate and closing costs make sense on their own.

PMI vs other mortgage insurance

PMI applies to conventional loans. FHA loans have their own mortgage insurance premium, which lasts for the life of the loan if you put down less than 10%. VA loans don't charge monthly mortgage insurance but have a one-time funding fee instead.

How to use the PMI Calculator

1. Open the PMI Calculator.
2. Enter the home price, your down payment, the interest rate and the loan term.
3. Enter the PMI rate from your lender's quote, as a yearly percentage of the loan.
4. Add an extra monthly payment to see how much sooner you reach 80%.
5. Read the results: the PMI added to each payment, your monthly payment with PMI, the starting loan-to-value and the total PMI if you cancel at 80% or wait until 78%, with a loan-to-value chart and a balance-and-PMI table by year.

Frequently asked questions

How much is PMI per month?

Multiply the loan by the yearly PMI rate and divide by 12. On a $360,000 loan at 0.5%, that's $150 a month.

When can I stop paying PMI?

You can ask to cancel it once your balance reaches 80% of the home's original value, and it ends automatically at 78%. In the example, that's after 7 years 11 months or 9 years 1 month.

How can I avoid PMI altogether?

Put at least 20% down on a conventional loan, or, if you're eligible, use a loan without monthly mortgage insurance, such as a VA loan. Some lenders also offer lender-paid mortgage insurance in exchange for a higher rate.