When Can I Get Rid of PMI? The 80%, 78%, and Midpoint Rules

You can get rid of PMI on a conventional loan once your principal balance reaches 80% of your home’s original value, provided you ask your servicer in writing and meet a few conditions. If you never ask, your servicer must cancel it automatically once the balance is scheduled to hit 78%. Both rights come from the Homeowners Protection Act of 1998, which covers conventional loans on primary residences closed on or after July 29, 1999.¹ PMI typically runs 0.2% to 2% of your loan balance per year, so on a $300,000 mortgage that’s $600 to $6,000 annually going to protect your lender.

Different rules apply to FHA loans, lender-paid PMI, and VA loans. Those are covered at the end.

Requesting Cancellation at 80% of Original Value

“Original value” means the lower of your purchase price or the appraised value at closing.² Once your principal balance drops to 80% of that number, you can submit a written cancellation request. Your servicer won’t act on its own at this point; the request has to come from you.

Four requirements have to be met: a written request, a good payment history, current status on the loan, and evidence that the property’s value hasn’t fallen below the original value with no subordinate liens attached.¹

What Counts as Good Payment History

The statute uses a two-tier lookback. In the 12 months right before your request, no payment can have been 30 or more days late. In the year before that (months 13 through 24), no payment can have been 60 or more days late.² One 30-day late in the past year is enough to disqualify you. If that’s your situation, waiting for the automatic 78% termination is often the more realistic path, since that trigger doesn’t run a payment-history check.

Property Value and Subordinate Liens

Your servicer needs proof the home hasn’t lost value. For a borrower-requested cancellation, that usually means paying for an appraisal, commonly $300 to $600 or more for a single-family property. The servicer picks the valuation type, which may be a full interior-and-exterior appraisal, a broker price opinion, or an automated valuation model.³

You also have to certify that no second mortgage, home equity line of credit, or other junior lien is attached to the home. Any subordinate lien blocks cancellation, even if the loan-to-value math works.¹ If you have an unused HELOC, closing it before you file the request can save you a denial.

Automatic Termination at 78%

If you never file a request, your servicer must terminate PMI on its own once your balance is first scheduled to reach 78% of the original value. The word “scheduled” matters. The servicer uses the amortization schedule set at closing, not what you actually owe. Extra payments that get you to 78% early don’t trigger automatic termination, though they do push you to the 80% mark for a borrower-initiated request sooner.¹

One condition still applies: you must be current when the termination date arrives. If you’re behind, PMI stays in place until the first day of the month after you catch up.⁴ No appraisal, no lien check, no paperwork from you.

The Final Deadline at the Loan’s Midpoint

Even if nothing else has removed PMI, federal law sets a hard stop at the first day of the month after you reach the midpoint of the loan’s amortization period. On a 30-year mortgage that’s the first day of the 181st month, about 15 years in.⁵ You still have to be current for the termination to take effect. This backstop mainly helps borrowers who missed the earlier windows or who have high-risk loans where the 78% and 80% rules don’t apply.

Getting PMI Off Early Because Your Home Gained Value

The statutory triggers all use original value. If your home has appreciated, you may be able to drop PMI well ahead of schedule using current market value instead. This route isn’t in the HPA; it comes from Fannie Mae and Freddie Mac guidelines, which govern most conventional loans.

Fannie Mae’s thresholds depend on how long you’ve had the mortgage:³

Two to five years of ownership: current loan-to-value of 75% or less based on the current appraised value.
More than five years of ownership: current loan-to-value of 80% or less.
Investment properties and multi-unit residences: 70% or less, with at least two years of ownership.

In the first five years you effectively need about 25% equity. Home improvements that added value can waive the two-year seasoning rule, but you’ll still need to hit 80% loan-to-value and get an interior appraisal that documents the work. You initiate the request and pay for the appraisal.

Sending the Request and Getting Premiums Back

Write to your servicer with your account number, property address, and a clear statement that you’re requesting PMI cancellation under the Homeowners Protection Act. Send it by certified mail with return receipt requested. The address for written requests is typically on your monthly statement or the servicer’s website.

Once the request arrives, the servicer must tell you what valuation is required and what it will cost. If the valuation supports the request and you meet the conditions, Fannie Mae’s guidelines direct the servicer to terminate the insurance and notify you within 30 days of receiving the results.³ A denial has to come in writing with the valuation results that led to it.

After cancellation or termination through any path, the servicer has 45 days to refund any unearned premiums you’ve already paid.¹ If PMI was in your escrow, your monthly payment should drop the next billing cycle. Watch for the change and follow up if it doesn’t appear.

Loans That Play by Different Rules

FHA Loans

The HPA does not apply to FHA loans. FHA mortgage insurance premiums follow HUD rules. For FHA case numbers assigned on or after June 3, 2013:⁶

Down payment of 10% or more: annual premiums stop automatically after 11 years.
Down payment under 10%: premiums run for the life of the loan.

If you put down less than 10% on an FHA loan, extra payments and appreciation won’t remove the premium. Refinancing into a conventional loan once you have at least 20% equity is the standard exit, and the closing costs need to be weighed against the ongoing premium.

Lender-Paid PMI

With lender-paid PMI, the lender covers the insurance and recovers the cost through a higher interest rate. There’s no separate premium to cancel, so the HPA cancellation rights don’t apply. It ends when you refinance or pay off the loan.⁷ Check your closing disclosure if you aren’t sure which type you have.

VA Loans

VA-backed loans don’t carry mortgage insurance. Most borrowers pay a one-time VA funding fee at closing instead, and there’s nothing ongoing to remove.⁸

High-Risk Conventional Loans

Loans classified as high-risk at origination don’t follow the standard 80% and 78% rules. Conforming high-risk loans follow Fannie Mae and Freddie Mac guidelines, which may set different thresholds. Nonconforming high-risk loans above the conforming limit have PMI terminated when the scheduled balance reaches 77% of the original value.⁹ Both categories still hit the midpoint backstop. Your closing disclosures should show a high-risk classification, and your servicer can confirm the schedule that applies to you.

1
Office of the Law Revision Counsel. 12 USC 4902 – Termination of Private Mortgage Insurance
2
Office of the Law Revision Counsel. 12 USC 4901 – Definitions
3
Fannie Mae. B-8.1-04, Termination of Conventional Mortgage Insurance
4
Office of the Law Revision Counsel. 12 USC Chapter 49 – Homeowners Protection
5
Farm Credit Administration. The Homeowners Protection Act of 1998 Public Law Number 105-216 Summary
6
HUD. FHA Single Family Housing Policy Handbook
7
National Credit Union Administration. Homeowners Protection Act PMI Cancellation Act
8
Veterans Affairs. VA Funding Fee and Loan Closing Costs
9
Consumer Financial Protection Bureau. Homeowners Protection Act HPA PMI Cancellation Act Procedures