PMI is priced on risk, and two factors dominate. Credit score is the biggest lever — the spread between a 760 and a 640 score can be more than triple the premium on an identical loan. Down payment is the second: 3% down is priced far worse than 10% down, because the insurer is covering more exposure.
Loan type matters too. Adjustable-rate loans, second homes, investment properties, and multi-unit properties all price higher than a fixed-rate loan on a primary residence.
| Profile | Typical annual rate | On a $300,000 loan |
|---|---|---|
| 760+ score, 10–15% down | 0.30% – 0.50% | $75 – $125/mo |
| 700–759 score, 5–10% down | 0.50% – 0.90% | $125 – $225/mo |
| 640–699 score, 3–5% down | 0.90% – 1.50% | $225 – $375/mo |
These are typical ranges, not quotes. Your actual premium is on your closing disclosure, and the dollar amount appears as a line item on your monthly mortgage statement.
Almost never. Most PMI is calculated on your original loan amount and stays flat for as long as the policy is in force. Your balance falls every month; your premium does not. That asymmetry is the whole reason cancelling on time is worth real money — every month you wait is a full-price payment on shrinking risk.
Federal law gives you two different moments. At 80% loan-to-value of the original value you may request cancellation in writing. At 78% your servicer must terminate it automatically, without being asked.
Those are typically 24 to 30 months apart on a 30-year loan. At $250 a month, letting it run to the automatic date instead of asking at 80% costs roughly $6,000 to $7,500. Servicers have no obligation to tell you the earlier date has arrived, and they don't.
Borrower-paid monthly PMI is the standard arrangement and the one covered by cancellation rights. Single-premium PMI is paid upfront in a lump sum at closing — nothing to cancel later, and generally no refund. Lender-paid PMI (LPMI) is built into your interest rate instead of appearing as a line item; it looks cheaper monthly, but it cannot be cancelled under the Homeowners Protection Act. Your only exits are refinancing or paying off the loan.
Check your statement: if there's no PMI line but your rate seems high for your credit profile, you may have LPMI.
The mortgage insurance premium deduction has expired and been retroactively revived several times by Congress. Whether it applies for a given tax year depends on current law and your income. Check the IRS guidance for the year in question or ask a tax professional — this is one to verify rather than assume.
Sometimes. A piggyback second mortgage, a lender-paid arrangement, or certain credit-union and physician programs can avoid monthly PMI — but each trades it for something else, usually a higher rate or a second payment. VA loans have no mortgage insurance at all.
Yes — extra principal moves your 80% date earlier. Whether a lump sum pays for itself depends on how close you already are. If you're 30 months out and paying $250, accelerating by 10 months saves $2,500; if you're three months out, it saves almost nothing.
Almost always credit score at the time of closing, down payment size, or occupancy type. The premium is locked in at origination — improving your score afterward doesn't lower it. Cancelling is the remedy, not repricing.