Private mortgage insurance, or PMI, is an extra cost on conventional loans when you put down less than 20%. It protects the lender if you stop paying, and it is added to your monthly payment.
When PMI applies
PMI generally applies to conventional loans with less than 20% down. The less you put down, the higher the PMI, and a stronger credit score usually means a lower PMI rate.
How to remove it
- Request removal once you reach 20% equity based on your original value
- PMI automatically ends at 22% equity on the original schedule
- A new appraisal showing higher value can sometimes accelerate removal
- Refinancing into a new loan once you have 20% equity removes it
How to avoid it entirely
Putting 20% down avoids PMI on a conventional loan. VA loans never charge monthly mortgage insurance, even with zero down.
PMI is not permanent on conventional loans. Ask us to map out exactly when yours can come off.