How to Remove PMI From Your Mortgage

Private mortgage insurance protects your lender if you default. You pay for it. It does nothing for you at all, and the entire skill involved is knowing the exact month you're allowed to stop.

There are two dates, they are eleven months apart on a typical loan, and only one of them happens without you doing anything. Servicers are not required to remind you about the earlier one. Most don't.

The law that sets the dates

The Homeowners Protection Act governs PMI on most conventional loans on a primary residence, and it hands you two separate rights that people constantly mash together.

The first is a request. In the CFPB's words, "You have the right to ask your servicer to cancel PMI on the date the principal balance of your mortgage is scheduled to fall to 80 percent of the original value of your home." You have to ask. Nothing happens if you don't.

The second is automatic. "Your servicer must automatically terminate PMI on the date when your principal balance is scheduled to reach 78 percent of the original value of your home." No request, no paperwork, no appraisal.

Two words in there are doing enormous work. "Scheduled" means the date comes off your original amortization schedule — the one printed at closing — not off your actual balance. Extra principal payments do not move these dates by themselves. And "original value" means the lower of the purchase price or the original appraised value. Your house going up 40% since 2021 does not trigger either threshold. Neither one has anything to do with what the place is worth today.

There's a third, less-known date for loans that aren't paying down on schedule: the CFPB says "Your lender or servicer must end the PMI the month after you reach the midpoint of your loan's amortization schedule." On a normal 30-year loan that's month 181, by which point you're long past 78% anyway. It exists to catch loans that have been modified, deferred, or otherwise dragged out.

Eleven months of nothing, priced out

Take a $300,000 house with 5% down. The loan is $285,000, 30-year fixed, and we'll use the 6.65% average from Freddie Mac's survey for the week of August 20, 2026. Principal and interest come to about $1,829.60.

1. Original value is $300,000. The 80% mark is $240,000. The 78% mark is $234,000.
2. On the original amortization schedule, the balance drops below $240,000 during month 126 — ten and a half years in.
3. It drops below $234,000 during month 137. Eleven months later.
4. At a PMI rate of 0.50% a year on the original loan amount, the premium is $118.75 a month.
5. Eleven months of not asking costs $1,306.25.

That's the whole game. One letter, sent at the right time, worth about thirteen hundred dollars. And that assumes you don't get there early.

The four conditions on the 80% request

The servicer must grant a borrower-requested cancellation when you meet the statutory conditions. Per the CFPB, those are:

• You make your request in writing. Not a phone call. Writing.
• You have a good payment history and are current on your payments.
• You can certify that there are no junior liens on the home — a second mortgage or a HELOC will block this, even an open one with a zero balance.
• You can provide evidence that the property value hasn't declined below its original value. The servicer may want a broker price opinion or an appraisal, and you'll typically pay for it.

The junior-lien condition catches people who opened a home equity line and forgot. If you have one and you're near the 80% mark, closing the line before you write the letter is usually the cheaper move — this site's HELOC comparison covers what you'd be giving up.

Getting there early with extra principal

Here's the part servicers don't advertise. The scheduled dates run off the original amortization. But if you've paid the balance down faster than schedule, you can generally ask for cancellation based on your actual balance once it's at or below 80% of original value — you're simply meeting the standard sooner. You still have to ask, in writing, and the same four conditions still apply.

So the sequence for anyone with spare cash and PMI is: find the balance that equals 80% of your original value, work out what it would take to get there, and write the letter the month you arrive. A $6,000 principal payment that kills $118.75 a month of insurance for years is not a bad trade.

Separately, many servicers will consider cancellation based on the home's current value — a rise in market value or a renovation — with a fresh appraisal. That is not a statutory right. It runs on the servicer's own rules and investor guidelines, including seasoning requirements. Ask yours what it requires in writing, and get the answer in writing.

The script

"I am requesting cancellation of private mortgage insurance under the Homeowners Protection Act. My loan number is ____. Based on my original property value of $____, my principal balance is at or below 80% of that value as of ____. I am current on my payments, I have no junior liens on the property, and I am prepared to provide evidence of current value. Please confirm in writing what documentation you require and the date PMI will be removed."

Send it in writing through the servicer's designated address for written requests — that address is on your monthly statement, and it is usually not the same as the payment address. Keep a copy and the delivery confirmation.

FHA mortgage insurance is a different animal entirely

None of the above applies to an FHA loan. The CFPB says it in one line: "Mortgages through the Federal Housing Administration (FHA) or Department of Veterans Affairs (VA) have different requirements." On FHA, "different" mostly means "worse."

FHA charges two premiums. An upfront premium of 175 basis points — 1.75% of the base loan amount — usually financed into the loan. Then an annual premium collected monthly. HUD's Mortgagee Letter 2023-05 sets the current schedule, and the column that decides your life is the one marked Duration.

On a 30-year FHA loan with a base loan amount at or under the national conforming limit, an original loan-to-value at or below 90% carries a 50-basis-point annual premium for 11 years. Above 90% and up to 95%, it's still 50 basis points — but for the mortgage term. Above 95%, it's 55 basis points, for the mortgage term. Larger loans above the conforming limit run 70 or 75 basis points on the same duration logic.

Read that against how FHA is actually used. The signature FHA down payment is 3.5%, which is a 96.5% loan-to-value, which lands in the "mortgage term" row. The premium is not cancellable by paying down the balance, by the house appreciating, or by asking nicely. It ends when the loan ends.

Which means escaping FHA mortgage insurance generally requires refinancing out of FHA into a conventional loan — and that only makes sense if the math on the refinance stands up on its own. This site's refinancing article has the break-even arithmetic; run it with the insurance savings included as a line item, because that's the piece that sometimes tips a marginal refinance into a good one.

One structural note worth catching: ML 2023-05 tied the base loan amount threshold in that table to the national conforming loan limit rather than a frozen dollar figure, so the tier boundary moves each year with the FHFA limit — $832,750 for 2026.

Don't pay for a value-based cancellation you don't need

A servicer that quotes you $500 for a new appraisal is quoting a service you may not require. If your scheduled 80% date is four months out, wait four months and send the letter — a cancellation on original value doesn't need a new opinion of value beyond confirming the property hasn't declined, and the automatic 78% termination needs nothing at all. Pay for an appraisal only when current-value cancellation would genuinely pull the date years forward, and only after the servicer has confirmed in writing that it will consider one.

Go find your closing documents, write down the purchase price, multiply it by 0.80, and compare that to the balance on this month's statement. If you're close, the letter goes out this week. If you're not, put the date on a calendar and let it sit there until it isn't.