What PMI and FHA MIP actually cost, and the specific ways each one goes away.
Mortgage insurance protects the lender if a loan defaults. You pay it, they benefit — which is why it's worth knowing exactly how to get rid of it.
Conventional PMI
Required when you put down less than 20%, priced on credit score and loan-to-value. It is cancellable: you can request removal at 80% loan-to-value based on payments or a new appraisal, and it terminates automatically at 78% by amortization schedule. Rising values mean many borrowers qualify for cancellation years earlier than they expect.
FHA mortgage insurance
FHA charges 1.75% upfront plus an annual premium. With less than 10% down it stays for the life of the loan regardless of equity. The only real exit is refinancing into a conventional loan — which is exactly why we check equity for FHA borrowers every year or two.
Structures worth pricing
Single-premium PMI paid upfront, lender-paid PMI built into a slightly higher rate, and a split first/second structure can each beat monthly PMI depending on how long you'll hold the loan. I'll price them side by side rather than defaulting to the standard option.
Keep reading
- Closing Costs: A Line-by-Line Walkthrough
Where 2% to 5% of the purchase price actually goes — and which items you can shop for.
- Debt-to-Income Explained: The Number That Decides Your Approval
How underwriters calculate DTI, which debts count, and the fastest levers to move it before you apply.
- Financing Your First Rental: DSCR, Reserves, and Real Returns
Investment loans price differently, require more down, and judge the property as much as the borrower. Plan for all three.
- HELOC vs Cash-Out Refinance: Which Tool Fits the Job
If your first mortgage rate is low, refinancing to access equity can be the expensive option. A second lien is often better.