PMI Removal Calculator
Private mortgage insurance (PMI) is required by lenders when you borrow more than 80% of a home's value. Under the federal Homeowners Protection Act of 1998, you have the right to request cancellation when your loan-to-value (LTV) ratio reaches 80% based on the original purchase price, and your lender must automatically cancel it when the LTV reaches 78% based on the scheduled amortization. This calculator walks through your amortization schedule month by month to find the exact payment number at which your balance crosses each threshold so you know when you can act.
PMI removal formula
LTV = Remaining Balance / Original Purchase Price
Cancel at: LTV <= 0.80 (borrower-requested)
Auto-terminate at: LTV <= 0.78 (lender-required by HPA)
The calculator amortizes the loan month by month using M = P * r(1+r)^n / ((1+r)^n - 1) and checks whether each month's ending balance divided by the original purchase price falls at or below 0.80 and 0.78 respectively.
PMI removal rules under the HPA
- You may submit a written request to cancel PMI when your LTV reaches 80% on the original purchase price schedule.
- Your loan must be current (no payments 30+ days late in the past 12 months).
- If you have made extra principal payments, your LTV may reach 80% sooner; request cancellation as soon as it does.
- Automatic termination at 78% requires no action from you, but the loan must be current.
- The savings shown reflect the PMI premiums you avoid by proactively requesting cancellation at 80% rather than waiting for automatic termination at 78%.
PMI removal: frequently asked questions
What is PMI and why do I have to pay it?
Private mortgage insurance (PMI) protects the lender, not you, if you default. Lenders require it when your down payment is less than 20% of the home's purchase price, meaning your LTV ratio exceeds 80%.
When can I request PMI cancellation?
Under the Homeowners Protection Act of 1998 (HPA), you can request PMI cancellation once your LTV reaches 80% based on the original purchase price and original amortization schedule. Your loan must be current with good payment history.
When is PMI automatically terminated?
The HPA requires lenders to automatically cancel PMI when the LTV reaches 78% of the original purchase price based on the scheduled amortization, even if you do not request it. The loan must be current.
Does home appreciation help remove PMI?
For HPA-mandated PMI, the threshold is based on the original purchase price, not current appraised value. However, many lenders allow PMI cancellation based on a new appraisal if your LTV has dropped to 80% due to appreciation or extra payments. Check your loan contract.
Can FHA mortgage insurance be removed the same way?
No. FHA mortgage insurance premium (MIP) rules differ from conventional PMI. For most FHA loans originated after June 2013, MIP remains for the life of the loan unless you put down at least 10%, in which case it drops after 11 years. See our FHA Loan MIP Calculator.
Official sources
- Consumer Financial Protection Bureau: When Can I Remove PMI?
- HUD: Buying a Home.
Reviewed by the CalculatorHub team, edited by James Graham, 15 June 2026. See our methodology.