PMI Explained Made Clear and Simple
Learn how PMI affects payments, approvals, and home financing options.
How is PMI Calculated?
The amount you'll pay for PMI depends on several factors, including the size of your loan, your down payment amount, debt-to-income ratio, and credit score. The larger your down payment, the less your PMI will cost. Those with higher credit scores and lower debt-to-income ratios typically pay lower rates as well.
How Much is PMI?
The average cost of private mortgage insurance, or PMI, for a conventional home loan ranges from 0.46% to 1.50% of the original loan amount per year, according to the Urban Institute's Housing Finance Policy Center. The amount varies in part by credit score. Borrowers with lower credit scores pay more for PMI than borrowers with higher credit scores. The calculator estimates how much you'll pay for PMI, which can help you determine how much home you can afford.
At those rates, PMI on a $300,000 mortgage would cost $1,380 to $4,500 per year, or $115 to $375 per month.
Average Annual PMI Premium
Your credit score Annual average premium as a percentage of original loan amount
| 620-639 | 1.50% |
| 640-659 | 1.31% |
| 660-679 | 1.23% |
| 680-699 | 0.98% |
| 700-719 | 0.79% |
| 720-739 | 0.70% |
| 740-759 | 0.58% |
| 760 and above | 0.46% |
Source: The Urban Institute’s Housing Finance Policy Center.
Smart Lending Starts With Clear Answers
Understanding PMI is just one part of building a confident path toward homeownership. Reach out today to explore mortgage solutions designed around your goals, budget, and future plans.