The 20 percent line
Loan amount is price minus down payment. The down-payment share is the down payment divided by the price. Loan-to-value is the loan divided by the price. On a $200,000.00 price with $20,000.00 down, the loan is $180,000.00, the down payment is 10 percent, and the loan-to-value ratio is 90 percent. The CFPB says you may be required to buy private mortgage insurance if you take out a conventional loan with a down payment of less than 20 percent of the purchase price. PMI protects the lender, not you, if you stop paying. The same answer says the requirement usually also applies when you refinance a conventional loan with equity of less than 20 percent. The flag on this page is that comparison and nothing more. A government-insured loan, an FHA mortgage, uses a different insurance premium. This flag does not describe it.
Twenty percent of $200,000.00 is $40,000.00. A down payment of that size is not under the line, so the flag changes. The page does not say 20 percent is the right down payment for you. It says the CFPB describes the conventional PMI requirement with that threshold. Cash you keep in the bank, a gift, and a more expensive house are decisions the ratio does not make. The affordability page divides a housing payment by income. It does not know your down payment either, unless the payment you type already reflects the loan that is left after the cash you put down.
Eighty percent and seventy-eight percent
The CFPB's cancellation answer says you can ask the servicer to cancel PMI on the date the principal balance is scheduled to fall to 80 percent of the home's original value, and that you can ask earlier if extra payments bring the balance there. Original value generally means the lower of the contract price and the appraised value at purchase. If you refinanced, original value is the appraised value at the refinance. This form has one number, the price you type, and it labels that limit. Eighty percent of $200,000.00 is $160,000.00. Seventy-eight percent is $156,000.00. The CFPB says that even if you never ask, PMI generally must terminate automatically when the balance is scheduled to reach 78 percent of original value, if you are current. If you are not current, termination waits until shortly after you catch up.
Asking is not enough by itself. The CFPB says the servicer must grant the request if you ask in writing, you have a good payment history and are current, you can certify there is no junior lien such as a second mortgage, and you can show the value has not fallen below the original value. If the value has fallen, you may not cancel on schedule. This calculator does not know your payment history or a new appraisal. The month it shows is only the first month on the fixed-rate schedule when the balance is at or under the threshold. On the opening example, 80 percent of price is reached in 89 months, and 78 percent in 103 months. The rate is 6 percent, the site's checked example rate, not a quote. A different rate moves the month. Extra principal would move it earlier. The payoff page is where an extra payment shortens a balance. This page does not add extra principal to the PMI clock.
No invented premium
PMI prices vary. A percent of the loan that this site made up would look like a fact. The monthly PMI field starts at zero. Type a dollar premium only if a disclosure gave you one. That dollar is added to the principal-and-interest payment for a single display line. It is not compounded, and it is not assumed to stop in the cancellation month inside the payment itself. You can see the month and the premium separately. The principal-and-interest payment uses the same function as the mortgage calculator. On the opening loan it is $1,079.19 before any premium.
The CFPB also says that for some loans, including interest-only loans, PMI must end at the midpoint of the original amortization even if the balance has not reached 78 percent. For a 30-year loan the midpoint is after 15 years. This fixed fully amortizing schedule usually hits 78 percent before the midpoint, which is why the page shows the balance test and not the midpoint. If your loan is interest-only for a long stretch, the midpoint rule can be the one that matters, and this schedule is the wrong shape. The HELOC page is interest-only on a line of credit, which is a different product and can be the junior lien that the cancellation rules ask about.
Price is not always original value
If the appraisal is lower than the contract price, original value for these percentages is the appraisal, and every balance on this page is too high if you typed the contract price. If you are refinancing, type the appraised value from that refinance if that is your original value, not the price you paid years ago. The page cannot tell those stories apart. It can divide the numbers you give it. Giuseppe Ilarda, the site owner, writes and checks the division. The result is not financial advice and not a reason to drain savings for a 20 percent down payment. The disclaimer says the calculators are educational. A Loan Estimate is where a lender's actual mortgage insurance, if any, is listed in dollars. Prefer that dollar to a blank field.