PMI (Private Mortgage Insurance)
Insurance required when your down payment is less than 20%, protecting the lender if you default.
PMI typically costs 0.5-1.5% of the loan amount annually, added to your monthly payment. On a $300,000 loan, PMI is $125-375 per month. It automatically cancels when you reach 20% equity (78% LTV ratio). You can request cancellation at 80% LTV. PMI protects the lender, not you — it is a cost of borrowing with less than 20% down, not insurance for your benefit.
Try it yourself:
Open PMI (Private Mortgage Insurance) Calculator →