PMI Private Mortgage Insurance - How to remove it from your mortgage

Buyers with down payments of less than 10% are required to get mortgage insurance. These loans are risky 
as evidenced with the "sub-prime" mortgage crisis.

The amount of the insurance is often $40 to $50 per month for a $100,000 home.  This payment is typically added to the overall payment

Homeowners continue to pay the PMI even after their loan balance has dropped below the original 80 percent threshold, which occurs as the equity in the home increases.

Previously, lenders were under no obligation to inform borrowers when they had reached a point where the PMI could be removed. In 1999, when the Homeowners Protection Act took effect and this law now obligates lenders to terminate the PMI when the principal balance of the loan reaches 78 percent of the original loan amount. 

The law stipulates that, upon request of the homeowner, the PMI must be dropped when the principal amount reaches only 80 percent!  This law only applies to home loans - whether first time or refinances - that closed after July, 1999. Also certain other conditions must be met, such as being current on the loan payments. Buyers that purchased before July 1999 can also have their PMI removed.

The question is when does the equity exceed the 20 percent point? A state certified appraiser can provide an accurate appraisal to determine this.  

Cancellation of Private Mortgage Insurance: Federal Law May Save You Hundreds of Dollars Each Year

Private Mortgage Insurance (PMI): Law Requires Lenders to Cancel PMI

Got a Question?

Do you have a question relating to real estate appraisals? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.

Information
Question
NASA PHOTO OF THE DAY:
 
NASA’s James Webb Space Telescope Inspects Cat’s Paw
7/11/2025 8:23 AM
To celebrate its third year of revealing stunning scenes of the cosmos in infrared light, NASA’s James Webb Space Telescope has “clawed” back the thick, dusty layers of a section within the Cat’s Paw Nebula (NGC 6334)....Read More
 
Anatomy of a Space Shuttle
7/11/2025 8:23 AM
This illustration shows the parts of a space shuttle orbiter. About the same size and weight as a DC-9 aircraft, the orbiter contains the pressurized crew compartment (which can normally carry up to seven crew members), the cargo bay, and the three main engines mounted on its aft end...Read More
 
Stellar Duo
7/11/2025 8:23 AM
The bright variable star V 372 Orionis takes center stage in this image from the NASA/ESA Hubble Space Telescope, which has also captured a smaller companion star in the upper left of this image. Both stars lie in the Orion Nebula, a colossal region of star formation roughly 1450 light years from Earth...Read More
 
Working in Space
7/11/2025 8:23 AM
NASA astronaut and Expedition 73 Flight Engineer Jonny Kim works inside the SpaceX Dragon cargo spacecraft completing cargo operations before it undocked from the International Space Station's Harmony module several hours later...Read More
 
Old Glory on the Red Planet
7/11/2025 8:23 AM
This close-up view of the United States flag plate on NASA's Perseverance was acquired on June 28, 2025 (the 1,548th day, or sol, of its mission to Mars), by the WATSON (Wide Angle Topographic Sensor for Operations and eNgineering) imager on the turret at the end of the rover's Mars robotic arm...Read More
 
To the Spacemobile!
7/11/2025 8:23 AM
Three members of NASA's Lewis Research Center’s (now NASA’s Glenn Research Center) Educational Services Office pose with one of the center’s Spacemobile space science demonstration units on Nov. 1, 1964...Read More
 
Hubble Captures an Active Galactic Center
7/11/2025 8:23 AM
This Hubble image shows the spiral galaxy UGC 11397, which resides in the constellation Lyra (The Lyre)...Read More
 
Astronaut Joe Engle Flies X-15
7/11/2025 8:23 AM
In 1963, Captain Engle was assigned as one of two Air Force test pilots to fly the X-15 Research Rocket aircraft. In 1965, he flew the X-15 to an altitude of 280,600 feet, and became the youngest pilot ever to qualify as an astronaut. Three of his sixteen flights in the X-15 exceeded the 50-mile (264,000 feet) altitude required for astronaut rating...Read More
 
Sparkling Andromeda
7/11/2025 8:23 AM
The Andromeda galaxy, also known as Messier 31 (M31), is the closest spiral galaxy to the Milky Way at a distance of about 2.5 million light-years. This new composite image contains data of M31 taken by some of the world’s most powerful telescopes in different kinds of light. This image is released in tribute to the groundbreaking legacy of Dr. Ver...Read More
 
Waning Crescent Moon
7/11/2025 8:23 AM
NASA astronaut Bob Hines took this picture of the waning crescent moon on May 8, 2022, as the International Space Station flew into an orbital sunrise 260 miles above the Atlantic Ocean off the northwest coast of the United States...Read More