Looks even worse to me
80% loan to value:
280,000x80%=$224,000
Estimated amount of paydown needed to get rid of PMI=$13,500
Effective interest rate on the $13,500
Interest at 4.125%=556.87
$91/m x 12 months=1092
Total annual cost of the $13,500=$1,648
Effective interest rate=12.2%
Answer: Yes it makes sense to pay down your mortgage to get rid of PMI, you are paying 12.2% interest on the $13.5k, and it only gets worse as you pay down your loan until you get rid of it. Your hair is on fire, do everything you can to get rid of it, I got a HELOC to pay down the difference until I could come up with the cash. Call your mortgage servicer and see what you need to do to get rid of it, some have hoops you will have to jump through. Let me know if this doesn't make sense I did it in a bit of a hurry..