Mortgage insurance adds to your monthly housing cost, but how much you pay, and for how long, depends on your loan type, down payment, and credit score.
Our mortgage insurance calculator estimates your monthly PMI, FHA MIP, or VA funding fee, shows when mortgage insurance drops off, and breaks down the full impact on your monthly payment and total loan cost.
Estimate your monthly PMI, FHA MIP, or VA funding fee. See how credit score, down payment, and loan type affect your total housing costs.
Mortgage Insurance Calculator
Estimate your monthly PMI, FHA MIP, or VA funding fee. See how credit score, down payment, and loan type affect your total housing costs.
PMI, MIP, and VA funding fee: what's the difference
All three serve a similar purpose — they protect the lender if you default — but they work very differently depending on your loan type.
Private mortgage insurance (PMI): Required on conventional loans when your down payment is less than 20%. Your PMI rate is determined by your LTV ratio and credit score: Better credit means a lower rate. PMI automatically cancels once your loan balance reaches 78% of the original home value, and you can request cancellation at 80%.
FHA mortgage insurance premium (MIP): Required on all FHA loans regardless of down payment. FHA MIP has two components: an upfront premium of 1.75% of the loan amount (typically financed into the loan) and an annual premium of 0.55% for most borrowers, collected monthly. For borrowers who put down less than 10%, MIP lasts for the life of the loan.
VA funding fee: A one-time fee charged on VA loans in lieu of monthly mortgage insurance. For most first-time VA loan borrowers in Regular Military, the fee is 2.15% of the loan amount and is typically rolled into the loan. Veterans with a service-connected disability rating are exempt.
Important mortgage insurance terms to know
Loan-to-value ratio (LTV): The percentage of the home's purchase price covered by the loan. A 10% down payment results in a 90% LTV. LTV is the primary driver of your PMI rate: the higher the LTV, the higher the rate.
PMI rate: Expressed as an annual percentage of the loan amount, divided into monthly payments. Rates typically range from 0.2% to 1.5%, depending on LTV and credit score. On a $360,000 loan, a 0.59% annual PMI rate equals $177 per month.
PMI drop-off: Under the Homeowners Protection Act, lenders must automatically cancel PMI when your loan balance reaches 78% of the original purchase price — typically around year 10 on a 30-year loan with 10% down. You can request cancellation at 80% LTV if you can demonstrate that the balance has been paid down through payments or appreciation.
Total PMI cost: The sum of all PMI payments made before cancellation. On a 30-year loan with 10% down, this can easily exceed $19,000, a meaningful cost that should factor into your decision about how much to put down.
Custom PMI rate override: If your lender has quoted you a specific PMI rate, enter it directly to get the most accurate payment estimate. Otherwise, the calculator estimates your rate based on your LTV and credit score tier.
How down payment affects mortgage insurance
The relationship between down payment and mortgage insurance cost is one of the most important trade-offs in home buying. Putting more down reduces or eliminates mortgage insurance, but requires more cash upfront.
A few general rules of thumb:
- Conventional loans at 20% or more down require no PMI at all. Below 20%, PMI applies — and the rate rises as the down payment decreases and as credit scores fall.
- FHA loans always require MIP regardless of down payment. If you can put 10% or more down, MIP cancels after 11 years. Below 10%, it runs for the life of the loan — which is a significant long-term cost compared to a conventional loan with PMI that cancels.
- VA loans have no monthly mortgage insurance at any down payment amount. The one-time funding fee is the only mortgage insurance cost, making VA loans highly competitive for eligible borrowers.
Running the numbers in the calculator across different down payment amounts can help you find the right balance for your situation.
How to get help choosing the right loan
The right loan type depends on your credit score, down payment, and long-term plans. A mortgage professional can model the total cost across loan types for your specific situation and help you pick the structure that makes the most sense.
Best Interest Financial can help. With decades of experience and over $1 billion in closed loans, their team knows how to find the right loan structure for your goals. Talk with a Best Interest loan officer to compare your options.