PMI Removal Calculator
Equity needed and months to drop mortgage insurance at 80% LTV.
What it does
Private mortgage insurance protects the lender on low down payment loans, and borrowers can usually shed it at eighty percent loan to value. The gap is balance minus eighty percent of current value, closed by paydowns, extra payments, or rising prices.
The tool above takes home value, balance, and extra monthly principal. It returns the equity gap, months at that pace, and current LTV.
Servicers add their own gates: payment history, seasoning, and current valuation by appraisal or broker opinion. Automatic termination lurks near seventy eight percent of original value, while borrower requested cancellation opens at eighty of current value.
Appreciation shortcuts everything. In rising markets the valuation path beats the paydown path, which is why a fresh value opinion often pays for itself.
How to use
- Enter conservative current home value.
- Enter the payoff balance from the statement.
- Enter extra principal monthly, or zero for the gap only.
- Call the servicer with value proof at eighty percent.
Formula
- LTV
- Loan share of current value as a percent.
- 0.80
- Cancellation threshold for most conventional PMI.
- extra
- Monthly principal beyond the required payment.
FHA mortgage insurance follows different removal rules, often lasting the loan. This page fits conventional PMI.
Worked example
Example: $400,000 home, $360,000 balance, $500 extra
Value 400,000, balance 360,000, extra 500 a month.
- LTV: 360,000 / 400,000 = 90.0%.
- Gap: 360,000 - 0.80 x 400,000 = 360,000 - 320,000 = $40,000.
- Months: 40,000 / 500 = 80 months.
- About 6 years 8 months of extra payments, sooner with appreciation.
Reference table
| Extra monthly | Months | Years |
|---|---|---|
| $250 | 160 | 13.3 |
| $500 | 80 | 6.7 |
| $1,000 | 40 | 3.3 |
| $2,000 | 20 | 1.7 |
Limits
- Conventional PMI rules. FHA differs substantially.
- Value estimates move the gap a lot.
- Servicer seasoning and history gates excluded.
- Appreciation ignored in the paydown date.
Common mistakes
- Waiting for automatic end while eligible to ask.
- Using listing fantasy as home value.
- Stopping extra payments just short of eighty.
- Ignoring FHA permanence rules.
- Skipping the written servicer request.
Try it yourself
Quick checks. Answers sit tucked under each question.
$500,000 value, $380,000 balance. Gap?
380,000 - 400,000 is negative. Already under 80%, LTV 76%.
$300,000 value, $270,000 balance, $750 extra?
Gap 270,000 - 240,000 = $30,000. Then 30,000 / 750 = 40 months.
Questions
When does PMI drop off?
Borrower requested near 80% of current value, automatic near 78% of original value, rules varying.
Does appreciation count?
Yes with fresh valuation proof. Rising markets shortcut paydowns.
What about FHA loans?
Mortgage insurance often lasts the loan life. Refinancing out is the usual exit.
How much does PMI cost?
Roughly 0.3 to 1.5% of the loan yearly, by credit and down payment.
Can I remove PMI in year one?
Usually only with big appreciation or paydown plus servicer seasoning met.
Does extra principal help?
Directly. Every dollar cuts the balance toward eighty percent.