Private mortgage insurance, or PMI, is commonly required on certain conventional mortgages when a borrower makes a smaller down payment. The federal Homeowners Protection Act establishes cancellation and termination rights for many mortgages secured by single-family principal residences.
A borrower may generally request PMI cancellation when the loan balance is scheduled to reach 80% of the home’s original value. A borrower who makes additional principal payments may be able to request cancellation earlier after reaching that threshold.
The request must generally be made in writing. The borrower must also be current, have a satisfactory payment history, certify that no junior liens exist, and provide evidence of the property’s value if requested.
For a purchase loan, “original value” generally means the lower of the purchase price or original appraised value. For a refinance, it generally means the appraised value at refinancing.
The servicer must generally terminate PMI automatically when the loan is scheduled to reach 78% of the property’s original value, provided the borrower is current. This date is based on the original amortization schedule rather than the property’s current market value.
Making additional principal payments does not move the scheduled automatic termination date forward, but it may allow the borrower to request cancellation sooner.
If PMI has not already ended, it must generally terminate after the loan reaches the midpoint of its original amortization period, provided the borrower is current.
These rules do not apply to every loan. FHA, VA, lender-paid mortgage insurance, and other loan structures follow different requirements. Review the current CFPB guidance on PMI cancellation or contact the loan servicer.
CoreVest makes commercial, business-purpose loans for real estate investments—not consumer mortgages for personal, family, or household use. PMI and the cancellation rules described above generally do not apply to CoreVest loans.
This article is provided for informational purposes only and does not constitute legal, financial, or lending advice. Mortgage insurance requirements vary by loan type, investor, servicer, and applicable law. Borrowers should review their loan documents and contact their servicer for guidance.
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