Your roadmap to dropping private mortgage insurance
The law behind the roadmap
Your next move
The Homeowners Protection Act gives borrowers with PMI on most conventional loans for a principal residence three protections: the right to request cancellation at the scheduled 80 percent point, automatic termination at the scheduled 78 percent point if current, and final termination at the loan's midpoint. Servicers must also tell you about these rights each year.
Last reviewed against the primary sources listed below.
Three dates
| Milestone | What happens | Your role |
|---|---|---|
| Scheduled 80 percent of original value | You may request cancellation | Ask in writing; meet conditions |
| Scheduled 78 percent of original value | PMI ends automatically | Be current on payments |
| Midpoint of the loan term | Final termination | Be current |
What it does not cover
Government-backed loans such as FHA have their own premium rules. Lender-paid mortgage insurance built into the rate works differently. Check the CFPB's guide for details.
PMI questions on the road
What does PMI stand for and what is it used for?
Private mortgage insurance. It protects the lender on a conventional loan when the borrower has less equity.
Does PMI go away once you hit 20 percent equity?
Under the law, you can request cancellation once the balance reaches 80 percent of original value, by schedule or extra payments. Automatic termination comes at 78 percent by schedule.