PMI is a monthly fee that protects your mortgage lender—not you—in case you default on your loan.
How Much PMI Costs
According to the Urban Institute’s Housing Finance Policy Center, annual PMI premiums range from 0.46% to 1.50% of your original loan amount.
On a $400,000 mortgage, that adds up to roughly $153 to $500 every month.
When You Can Cancel It
Under the federal Homeowners Protection Act, you have the right to request PMI cancellation once your loan-to-value ratio (LTV) reaches 80%.
Your lender must automatically cancel PMI once your LTV hits 78% or you reach the midpoint of your loan term.
Smart Ways to Remove PMI Faster
Making extra principal payments helps you build home equity quicker and reach that 80% LTV milestone sooner.
You can also request a new property appraisal if your home's value has increased due to local market growth or home renovations.
PMI and Your Taxes
Under the One Big Beautiful Bill Act, PMI payments are tax-deductible as mortgage interest starting in the 2026 tax year for qualifying homeowners who itemize.
This deduction phases out for individual taxpayers with an adjusted gross income above $100,000.
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