To sum up, when it comes to PMI, if you have less than 20% of the sales price or value of a home to use as a down payment, you have two basic options: Use a “stand-alone” first mortgage and pay PMI until the LTV of the mortgage reaches 78%, at which point the PMI can be eliminated.

Use a second mortgage.

### When can you drop PMI insurance?

To remove PMI, or private mortgage insurance, you must have at least 20% equity in the home. You may ask the lender to cancel PMI when you have paid down the mortgage balance to 80% of the home’s original appraised value. When the balance drops to 78%, the mortgage servicer is required to eliminate PMI.

### How do you calculate PMI on a mortgage?

Next, determine the mortgage insurance rate by using a table on a lender’s website. Then, multiply the loan amount by the mortgage insurance rate to calculate PMI. To determine the monthly payment amount, divide the annual payment by 12.

## Can you negotiate PMI?

The lender rolls the cost of the PMI into your loan, increasing your monthly mortgage payment. You cannot negotiate the rate of your PMI, but there are other ways to lower or eliminate PMI from your monthly payment.

Photo in the article by “Wikipedia” `https://en.wikipedia.org/wiki/Federal_Housing_Administration`