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How to Calculate PMI

Here is an example of the rates from one of the Private Mortgae Insurance Companies and how you would calculate a PMI payment.

These rates are subject to change and are valid only on "conforming loans". Different rates apply for sub-prime loans, non-conforming loans or jumbo mortgages.

LTV	PMI Rate for 30 year mortgage	PMI Rate 10, 15, 20 year mortgage
80.01% - 85%	.32	.19
85.01 - 90%	.52	.23
90.01% - 95%	.78	.26
95.01% - 97%	.90	.79

Calculating the PMI Payment
For this example, we will assume you have put 5% down, are getting a 30 yr fixed rate and your mortgage is going to be $150,000 after the down payment,

Down Payment: 5%
Loan Amount: $150,000
Mortgage Program: 30 year fixed

First, find your PMI rate

In the LTV column, you find the percentage that corresponds with your loan
(with 5% down, it is 95%)

Follow this row across to the column for your type of mortgage. (this is a 30 yr fixed)

Locate your rate ( for this example it is .78)

Next, multiply your loan amount by the rate to get the annual PMI cost
Loan amount: $150,000
Rate: .78

$150,000 x .78% or $150,000 x .0078 = $1170 per year

Finally, divide the annual rate by 12 to get your monthly payment
Divide $1170 by 12 (months) = $97.50 per month

$97.50 would be the Monthly PMI Premium for this loan

Important Notes and more fine print

These premiums are based on the "non-refundable" monthly premium option, with NO up-front payment.

Maximum base loan amount for Conventional, Conforming Loans in 2005 is $359,650.

Sub-Prime, Non-Conforming and Jumbo Loans may have different rate multipliers

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