How to remove PMI: request cancellation, automatic termination, and appraisal-based removal
PMI adds $100–$300 per month to most mortgages with less than 20% down. This guide covers the three ways to remove it — automatic termination at 78% LTV, a written cancellation request at 80% LTV, and an appraisal-based removal when your home has appreciated.
You can remove PMI as soon as your loan balance reaches 80% of the original purchase price — but the servicer will not cancel it automatically until 78%. Knowing the difference between cancellation, auto-termination, and appraisal-based removal can save you thousands.
Three ways PMI is removed
Submit a written cancellation request once your balance reaches 80% of the original purchase price. Requires good payment history and no subordinate liens. Does not happen automatically — you must ask.
Under federal law, your servicer must cancel PMI automatically on the date your scheduled amortization reaches 78% of original purchase price. No action needed — but waiting costs you the 78%–80% window.
If your home has appreciated, you can request removal based on current appraised value once you are at least 2 years into the loan. Requires a lender-approved appraisal ($400–$600). Servicer discretion applies.
Step-by-step: how to cancel PMI
- 1Confirm you have borrower-paid PMI (BPMI)
PMI removal rights under the Homeowners Protection Act apply only to borrower-paid PMI (BPMI) — the monthly line item on your statement. Lender-paid PMI (LPMI) is embedded in your rate and cannot be removed without refinancing. Check your mortgage statement or closing disclosure for "PMI", "MI", or "mortgage insurance premium" as a separate charge.
- 2Check your current LTV based on original purchase price
Divide your current loan balance by your original purchase price (not current value). If the result is 0.80 or below, you can submit a written cancellation request today. If it is between 0.80 and 0.78, track your next few scheduled payments — the lender must auto-cancel at 78% based on your amortization schedule.
- 3Submit a written PMI cancellation request at 80% LTV
Under the HPA, you have the right to request PMI cancellation when: (1) your loan balance reaches 80% of the original purchase price on the scheduled amortization date, or sooner via extra payments; (2) you have a good payment history (no 30-day late in the past 12 months, no 60-day late in the past 24 months); and (3) you confirm no subordinate liens. Send the request in writing to your servicer via certified mail or their online portal.
- 4Request appraisal-based removal if your home has appreciated
If your home has appreciated significantly since purchase, you may be able to remove PMI based on current value rather than original price — even if you have not reached 80% LTV on the original purchase price. Requirements vary by lender and loan type: typically you must be 2+ years into the loan, your LTV based on current appraised value must be ≤ 80% (some lenders require 75% in the first 5 years), and you must order an approved appraisal at your cost ($400–$600). Confirm your lender's specific policy in writing before ordering the appraisal.
- 5Verify PMI is removed from your next statement
After cancellation is approved, confirm PMI does not appear on your next monthly statement. Servicers must cancel PMI within 30–45 days of approval. If PMI is still appearing after 2 billing cycles, escalate in writing to your servicer and file a complaint with the CFPB at consumerfinance.gov/complaint if not resolved.
PMI removal timeline by LTV
| LTV | PMI status | Action required |
|---|---|---|
| > 80% | PMI active | None — continue payments or make extra principal payments |
| 80% (original price) | Eligible for cancellation | Submit written request to servicer + meet good-payment criteria |
| 80% (current appraised value) | Eligible if ≥ 2 years in loan | Order approved appraisal + request removal in writing |
| 78% (original price, scheduled) | Auto-termination required | No action needed — servicer must cancel |
| < 78% | PMI must be cancelled | Contact servicer if still appearing on statement |
External references
- CFPB — When can I remove PMI?
- HUD — Homeowners Protection Act overview
- CFPB — File a complaint if PMI is not removed
- Fannie Mae — Mortgage insurance cancellation guidelines
- Freddie Mac — PMI cancellation fact sheet
Common questions
What is the Homeowners Protection Act and what rights does it give me?
The Homeowners Protection Act (HPA) is a federal law that gives borrowers the right to request PMI cancellation at 80% LTV (based on original purchase price), and requires automatic termination at 78% LTV. It also requires lenders to notify you annually of your right to cancel PMI. The HPA applies to conventional loans originated on or after July 29, 1999. FHA loans are not covered — FHA MIP has different rules and for loans with less than 10% down, cannot be cancelled at all.
Can I remove PMI early by making extra payments?
Yes. Any extra principal payments accelerate your amortization, and you can request PMI cancellation as soon as your balance drops to 80% of the original purchase price — regardless of time elapsed. Use the extra payment calculator to find how much you need to pay to reach 80% LTV by a target date. Once there, submit the written cancellation request to your servicer — it does not happen automatically until 78%.
What is the difference between PMI cancellation and automatic PMI termination?
PMI cancellation requires you to submit a written request when your balance reaches 80% of original purchase price — it is your right, but the servicer will not act without your request. PMI automatic termination happens at 78% LTV based on your scheduled amortization date, with no action required from you. The HUD HPA overview explains both triggers and the lender's obligations.
My home has appreciated a lot — how do I use current value to remove PMI?
You can request PMI removal based on current appraised value if: (1) you have been in the loan for at least 24 months (or 12 months with significant improvements), (2) your LTV based on current value is 80% or less (some lenders require 75% if less than 5 years in), and (3) you order an appraisal from an appraiser approved by your servicer. Call your servicer first to confirm their exact policy and get the approved appraiser list. The CFPB PMI guide notes that lenders are not required to use current value — it is at servicer discretion.
Does refinancing remove PMI?
Yes — if you refinance into a new loan at 80% LTV or below (based on the new appraised value), the new loan will not have PMI. This is the most reliable PMI removal path when your home has appreciated significantly. Compare the refinance cost (typically 2–3% of the loan balance in closing costs) against the monthly PMI savings to calculate your break-even period. Use the refinance break-even calculator to run the numbers.
See how quickly extra payments get you to 80% LTV on the extra payment calculator — or read the how to avoid PMI guide if you have not yet purchased.