Home Buying
Monthly mortgage insurance above 80% LTV
The premium applies only while LTV exceeds 80%. Typical annual rates run from roughly 0.19% to 1.5% depending on credit score and LTV band.
The Formula
Monthly PMI = Loan Amount x Annual PMI Rate / 12
The premium applies only while LTV exceeds 80%. Typical annual rates run from roughly 0.19% to 1.5% depending on credit score and LTV band.
| Symbol | Meaning | Unit | Notes |
|---|---|---|---|
| r(pmi) | Annual PMI rate on the original loan amount | decimal | Ask the lender for the actual figure; it varies materially by score and LTV band. |
| M | Monthly insurance premium | currency | Ends automatically at 78% LTV, and can be requested earlier at 80% on borrower-paid policies. |
What Each Symbol Means
r(pmi)decimal
Annual PMI rate on the original loan amount
Ask the lender for the actual figure; it varies materially by score and LTV band.
Mcurrency
Monthly insurance premium
Ends automatically at 78% LTV, and can be requested earlier at 80% on borrower-paid policies.
See It Worked With Real Numbers
A formula on its own does not tell you which number goes where. The how to calculate a down payment page applies this equation to a concrete case, shows every intermediate step, and names the mistakes that produce a wrong answer even when the algebra is right.
Where This Formula Appears
This equation is the working core of How To Calculate A Down Payment, filed under Finance. Every number the guide produces comes from substituting into this one line.