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When does PMI cancel on a standard 30-year conventional loan?

by ORedman from Miami, Florida. Apr 22nd 2013 Reply


Charlie Sparks (CharlieSparks)
#9 ranked lender in New Mexico - 397 contributions

When you 20% equity in the property. This can be any combination of price appreciation in your area, principal reduction of the mortgage, or increase of value due to improvements you make. A new appraisal will be required to determine the current loan-to-value. Check with your lender first as they will need to order the appraisal and the PMI co. may have additional requirements for cancellation, such as a minimum number of PMI payments.

Apr 22nd 2013
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James Mazzola (Mazzola)
#110 ranked lender in New Jersey - 313 contributions

1. You should have received a disclosure telling you when it ends. 2. If you pay down the loan or the value increases, you have to ask you current lender to see what their guidelines are.

Apr 22nd 2013
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Ken Burrows (mortgagesforamerica)
#19 ranked lender in Nevada - 572 contributions

With the market going up lately it could be wise to get an appraisal and if it shows it is above 80% LTV then your lender should drop the MI.

Apr 22nd 2013
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Sharon Duffy (sduffy)
#71 ranked lender in Pennsylvania - 595 contributions

FHA pmi has to stay on the loan a minimum of 5 years and once the balance is under 80% of the original price (or value on a refinance) the borrower must request that the pmi come off. At 78% the pmi will be removed automatically by the lender.

Apr 22nd 2013
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Dave Metsker (DaveMetsker)
#37 ranked lender in Oregon - 2,317 contributions

At a mortgage balance of 80% of original purchase price, by request, at 78%, automatically.

Apr 22nd 2013
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Joe Shamie (Joe Shamie)
#4 ranked lender in New Jersey - 1,412 contributions

It is actually when your LTV hits 78%. You will need an appraisal and will probably have to be by an approved appraiser that your bank will select.

Apr 22nd 2013
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Ralph Richard Guertin (ralph@absolutelowrates.com)
#2 ranked lender in Florida - 794 contributions

Hi, if you think your close to 80% I would contact your lender/servicer and find out your options. I have seen lenders not drop PMI after 78% when it was supposed to be automatic...

Apr 22nd 2013
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When your loan-to-value reaches 78% it will be canceled automatically, when the loan reaches 80% it you'll need to request it. To determine that it has reached 80% you'll need to order an appraisal.

Apr 22nd 2013
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Peter Savino (855411LEND)
#100 ranked lender in New Jersey - 332 contributions

When you closed you should have recieved the amorization schedule which will show you.

Apr 22nd 2013
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Linda Burek (lburek)
#138 ranked lender in Florida - 25 contributions

The below answers are correct. At 80% ltv or automatically removed by the lender at 78%.

Apr 22nd 2013
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Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 3,915 contributions

There are two options: The first is that the PMI will automatically cancel once you reach 78% of the original loan balance all by itself. The second is you can ask to have it removed once you believe the loan has dropped below 80% of the current value. They will almost always make you get an appraisal to prove the value.

Apr 22nd 2013
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Carlos Figueira (carlosfigueira)
#108 ranked lender in New Jersey - 198 contributions

Last comment by Joe is on the money!

Apr 22nd 2013
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Raymond Denton (Raymond)
#11 ranked lender in Ohio - 224 contributions

When you own a 20% interest in your home.

Apr 22nd 2013
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Charles Caporina (Charley)
#154 ranked lender in Texas - 1 contribution

Most of the time, our PMI just drops off after you hit 78% LTV. I concure with Mizzola, read the disclosures, make your LO run that question up the flagpole early on. Not all are the same (depends as much on the servicer as the originator). It's lot easier if you can just pay down your note and not have to worry about appraisals later on.

Apr 22nd 2013
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