How to Cancel PMI: The Complete Playbook

If you put less than 20% down on a conventional loan, you're paying private mortgage insurance (typically $30 to $300+ every month), and here's the part nobody tells you: PMI protects your lender, not you. You get nothing for it. Which means the day you can legitimately cancel it is the day you give yourself a raise.

There are four ways off this treadmill. This guide covers all of them; the rest of our articles go deep on each.

First, know which number you're playing against

PMI cancellation runs on loan-to-value (LTV): your loan balance divided by your home's value. The wrinkle is that "value" means two different things depending on which path you're using:

• Original value: the lesser of your purchase price or the original appraisal. This is what your federal rights are measured against.
• Current value: what the home is worth today. This is what the servicer path (the one they don't advertise) is measured against. If you bought in the last several years, it's probably your fastest route.

Grab your latest mortgage statement (for your balance) and your closing documents (for original value). Two minutes of math tells you which paths are open. Or skip the math: our free PMI checker runs all four paths at once.

Path 1: Request cancellation at 80% of original value

The Homeowners Protection Act of 1998 gives you a legal right to request PMI cancellation once your balance reaches 80% of your home's original value. The requirements: the request must be in writing, you must be current with a good payment history (generally no 30-day lates in the past year, no 60-day lates in the past two), and your servicer may ask for evidence the value hasn't declined and that there are no junior liens.

This one takes a letter, not luck. We have a free template.

Path 2: Automatic termination at 78%

Once your balance hits 78% of original value on your scheduled amortization, your servicer must cancel PMI automatically. You don't have to ask; you just have to be current on payments. If you've passed this point and PMI is still on your statement, you may be owed a refund of every premium charged since the trigger date. Here's how to claim it.

There's also a backstop: at the midpoint of your loan term (year 15 of a 30-year loan), PMI must terminate regardless of LTV, as long as you're current.

Path 3: The current-value path (the one servicers don't advertise)

Federal law measures against your original value, but if your home has appreciated, most servicers will cancel PMI based on today's value under investor guidelines. The general framework: roughly 75% LTV or below with 2–5 years of seasoning, or 80% or below after 5 years. Substantial documented improvements can sometimes shortcut the seasoning requirement.

The catch: your servicer will require its own appraisal or broker price opinion, typically $100–$600, ordered through their process. Rules vary by servicer and by who owns your loan. Full walkthrough here.

Path 4: Refinance out of it

If you refinance into a new conventional loan at 80% LTV or below, PMI simply doesn't come with you. This is rarely worth doing just for PMI on a conventional loan (closing costs usually eat the savings), but it's the only exit for most FHA borrowers, whose mortgage insurance can't be cancelled at all. FHA owners, read this first.

Which path is yours?

• Balance ≤ 78% of original value → Path 2. Call your servicer today; ask about refunds.
• Balance ≤ 80% of original value → Path 1. Send the letter.
• Home appreciated significantly, 2+ years in → Path 3. Call before paying for anything.
• FHA loan → Path 4 is almost certainly your answer.
• None yet → know your number. A one-time principal payment that gets you to 80% often beats months of PMI; the checker does that math for you.

Educational content, not financial advice. Cancellation requirements vary by servicer and loan investor; confirm specifics with yours.