Private Mortgage Insurance Explained

Private Mortgage Insurance (PMI) protects your lender if you default on your loan. It's required on conventional mortgages when your down payment is below 20%.

How Much Does PMI Cost?

PMI typically costs 0.3% to 1.5% of your loan amount annually. On a $350,000 mortgage, that's $1,050 to $5,250 per year, or roughly $90 to $440 per month.

How to Remove PMI

• Reach 20% equity (80% loan-to-value) and request cancellation
• Let it auto-cancel when you reach 78% LTV (for most conventional loans)
• Refinance if your home value has risen significantly
• Make extra principal payments to build equity faster

Alternatives to PMI

Some lenders offer lender-paid PMI (higher rate, no monthly PMI) or piggyback loans (80/10/10 structure). Run the numbers to see which saves more over time.