How to remove PMI from a conventional mortgage
Understand the 80% cancellation request, 78% automatic termination date, final midpoint rule, current-value options, and what the servicer may require.
On many borrower-paid conventional mortgages secured by a principal residence, federal law allows the borrower to request PMI cancellation when the balance is scheduled to reach, or actually reaches, 80% of the home's original value, provided the applicable conditions are met. If PMI is not cancelled by request, it generally terminates when the balance is scheduled to reach 78% of original value and the loan is current. Fannie Mae and Freddie Mac may also permit a separate current-value path with additional servicing requirements.
The three federal PMI milestones
These common Homeowners Protection Act rules apply to many borrower-paid PMI arrangements on principal-residence mortgages. High-risk, nonconforming, lender-paid, government-insured, modified, older, and other excluded loans can follow different rules.
| Path | Trigger | Key condition |
|---|---|---|
| Borrower request | Scheduled or actual balance reaches 80% of original value | Written request, current status, good payment history, and permitted value or lien evidence |
| Automatic termination | Scheduled balance reaches 78% of original value | The loan is current; no borrower request is required |
| Final termination | First day of the month after the amortization-period midpoint | The loan is current; no LTV threshold applies |
Original value is not current market value
The CFPB's PMI guidance explains that original value generally means the lower of the purchase price or original appraisal for a purchase, or the appraisal relied upon for a refinance. The statutory 80% and 78% milestones use that original value, not a current online estimate.
Extra principal can cause the balance to actually reach 80% of original value sooner and may accelerate a qualified borrower-requested cancellation. It does not convert the 78% automatic-termination rule into an actual-balance test: that date is based on when the balance was scheduled to reach 78% under the applicable amortization schedule.
Current-value cancellation after appreciation
Fannie Mae and Freddie Mac servicing rules provide a separate borrower-requested path based on current property value. For a one-unit principal residence or second home, the current published rules generally use 75% or lower current LTV when the loan is between two and five years old, and 80% or lower after five years. Qualifying substantial improvements may affect the seasoning requirement; ordinary maintenance does not automatically qualify.
This is not the same as the federal original-value right. It depends on who owns the loan, the applicable servicing rules, seasoning, payment history, property type, current LTV, and an approved valuation. Review Fannie Mae's MI termination guide or Freddie Mac's cancellation guide, then ask the servicer which path governs the loan.
Do not order an appraisal first and assume it will count. The servicer generally must order or approve the valuation through the applicable process, and the borrower may be responsible for the cost.
A practical request checklist
- Find the PMI disclosure and identify the scheduled cancellation and termination dates.
- Confirm whether the charge is borrower-paid PMI and whether the property and loan fall within the federal rules discussed here.
- Ask the servicer who owns or guarantees the loan and whether an original-value or current-value path is available.
- Submit the cancellation request in writing and keep the request, delivery evidence, and response.
- Ask what payment-history, lien, property-condition, seasoning, and valuation evidence applies before ordering anything.
- Keep paying the billed amount until the servicer confirms the cancellation or termination and its effective date.
Fannie Mae and Freddie Mac provide official Fannie Mae loan lookup and Freddie Mac loan lookup tools. A lookup result can identify an owner, but the current servicer still processes the request.
What this guide does not combine with PMI
FHA uses mortgage insurance premiums, or MIP, rather than conventional borrower-paid PMI. The FHA case date, original LTV, term, and HUD rules control MIP duration. Lender-paid mortgage insurance is also outside the Homeowners Protection Act's borrower-cancellation framework. Two-to-four-unit primary residences, investment properties, second homes, high-risk loans, and nonconforming loans can have different thresholds or investor rules.
Refinancing is a separate decision. Conventional borrower-paid PMI may be removable without replacing the mortgage, while a refinance creates a new loan with new qualification, pricing, costs, and break-even math. Keep that comparison in the refinance decision guide and the product differences in the FHA versus conventional guide.
PMI removal questions
When can I request PMI cancellation on a conventional mortgage?
On many borrower-paid conventional mortgages secured by a principal residence, the borrower may request cancellation when the balance is scheduled to reach, or actually reaches, 80% of the home's original value. Federal conditions include a written request, current payments, good payment history, and any permitted property-value or subordinate-lien evidence.
What is the difference between the 80% and 78% PMI rules?
The 80% rule is generally a borrower-requested cancellation path with conditions. The 78% rule is generally automatic termination when the balance is scheduled to reach 78% of original value and the loan is current. The automatic rule uses the scheduled balance, not an estimate of current home equity.
Can home appreciation help remove PMI earlier?
Possibly, but that is a separate current-value path rather than the federal original-value milestones. Fannie Mae or Freddie Mac servicing rules may allow borrower-requested cancellation after seasoning, payment-history, current-LTV, approved-valuation, and other requirements are met. Ask the servicer which rules apply.
Can extra principal payments help remove PMI?
Extra principal can cause the balance to actually reach 80% of original value earlier and may accelerate a qualified borrower-requested cancellation. It does not turn the 78% automatic-termination date into an actual-balance test. Confirm how the servicer applied the funds and request cancellation in writing.
Can I order my own appraisal to remove PMI?
Do not assume an independently ordered appraisal will qualify. Current-value cancellation under Fannie Mae or Freddie Mac rules generally requires a valuation ordered through the servicer's approved process, often at the borrower's expense. Ask the servicer for instructions before ordering or paying for anything.
Can FHA mortgage insurance be removed under the same PMI rules?
No. FHA uses mortgage insurance premiums, or MIP, and the Homeowners Protection Act rules for conventional borrower-paid PMI do not govern FHA MIP. The FHA case date, original loan-to-value, loan term, and current HUD rules determine its duration.
Can lender-paid mortgage insurance be cancelled under these rules?
Generally no. The Homeowners Protection Act's borrower-requested cancellation and automatic-termination provisions do not apply to lender-paid mortgage insurance in the same way. Check the loan documents and servicer records before assuming the loan has borrower-paid PMI.
Ask the servicer which rule applies
The PMI disclosure, loan ownership, payment history, property type, and approved valuation process determine the path. Use the official lookups and keep the request in writing.