You Could Be Wasting $100-$600/Month on PMI
If your home equity has grown since you bought, you may qualify for PMI removal right now. Federal law requires lenders to cancel PMI at 78% LTV — but you can request it at 80%. Check if you qualify and start saving immediately.
How to Remove PMI from a Conventional Loan 2026: Homeowners Protection Act Guide
Private Mortgage Insurance (PMI) on conventional loans must be removed by federal law when your loan-to-value ratio reaches 78%. You can also request removal at 80%. Here is the complete step-by-step guide to eliminating PMI and saving $100-$600/month.
Auto-Cancel At
78% LTV
Request At
80% LTV
Avg Savings
$200/mo
Federal Law
HPA 1998
Quick Answer: How to Remove PMI
Under the Homeowners Protection Act (HPA) of 1998, your lender must automatically cancel PMI when your loan balance reaches 78% of the original purchase price — as long as your payments are current. You can also request PMI removal at 80% LTV by submitting a written request and paying for a new appraisal ($400-$700).
If you have an FHA loan, the HPA does not apply — FHA MIP can only be removed by refinancing to a conventional loan. Compare refinance rates to see if refinancing makes sense for you.
The Homeowners Protection Act (HPA): Your Federal Right
The Homeowners Protection Act of 1998 is a federal law that gives conventional loan borrowers the legal right to have PMI removed. It applies to all conventional loans originated after July 29, 1999. Here are the three key protections:
Automatic Termination at 78% LTV
Your lender MUST automatically cancel PMI when your loan balance reaches 78% of the original purchase price. No request needed. This happens automatically as you pay down the loan.
Borrower-Requested Cancellation at 80% LTV
You can request PMI removal earlier — at 80% LTV — if you have made extra payments or your home has appreciated. Requires a written request and appraisal. No late payments in the past 12 months.
Final Termination at Loan Midpoint
Even if your LTV has not reached 78%, PMI must be cancelled at the midpoint of your loan term (e.g., year 15 of a 30-year loan) — as long as payments are current.
Important: The HPA only applies to conventional loans. FHA, VA, and USDA loans have their own mortgage insurance rules. FHA MIP lasts the life of the loan (if <10% down). VA has no ongoing PMI. USDA has a 0.35% annual guarantee fee for the life of the loan.
4 Ways to Remove PMI in 2026
Method 1: Wait for Automatic Cancellation (78% LTV)
How it works: Your lender automatically cancels PMI when your loan balance hits 78% of the original purchase price.
Timeline: Depends on your amortization schedule. On a $400K loan at 6.37%, it takes approximately 9-10 years to reach 78% LTV with standard payments.
Cost: Free — no action needed.
Best for: Borrowers who are patient and want zero hassle.
Method 2: Request Removal at 80% LTV (Appraisal Route)
How it works: If your home has appreciated or you have made extra payments, you can request PMI removal at 80% LTV.
Steps: 1) Check your current LTV. 2) Submit written request to your servicer. 3) Pay for appraisal ($400-$700). 4) Lender responds within 30 days.
Requirements: No late payments in past 12 months. No second mortgages behind the first. Home must appraise high enough.
Best for: Borrowers in appreciating markets or who made extra payments. Compare lenders →
Method 3: Refinance to Remove PMI
How it works: Refinance your conventional loan into a new conventional loan at 80% LTV or better. PMI is eliminated on the new loan.
Also works for FHA: If you have an FHA loan, refinancing to conventional at 80% LTV removes MIP permanently. This is the only way to remove FHA MIP.
Cost: Closing costs ($2K-$5K) but you save PMI/MIP every month going forward.
Best for: FHA borrowers, or conventional borrowers who also want a lower rate. Compare refinance rates →
Method 4: Recast Your Mortgage (Lower Balance, Same Rate)
How it works: Make a large lump-sum payment to bring your LTV below 80%, then ask your lender to recast (recalculate) your monthly payment without refinancing.
Cost: Recast fee ($200-$500) + the lump sum payment. No appraisal, no closing costs, no new rate.
Best for: Borrowers who have cash to pay down the balance and want to keep their current interest rate.
How Much Can You Save by Removing PMI?
| Loan Amount | Credit Score 760+ | Credit Score 700 | Credit Score 620 |
|---|---|---|---|
| $300,000 | $40-$70/mo | $93-$135/mo | $375-$465/mo |
| $400,000 | $53-$93/mo | $123-$180/mo | $500-$620/mo |
| $500,000 | $67-$117/mo | $154-$225/mo | $625-$775/mo |
| $600,000 | $80-$140/mo | $185-$270/mo | $750-$930/mo |
Example: You have a $400K loan, 700 credit score, paying $150/month in PMI. Removing PMI saves you $1,800/year and $54,000 over 30 years. The appraisal costs $500 — you break even in 3.3 months. Get pre-approved to check your options →
Step-by-Step: Requesting PMI Removal at 80% LTV
Calculate your current LTV
Divide your current loan balance by your home value. If the result is 80% or less, you qualify. Use your original purchase price or a recent appraisal.
Check your payment history
You need no late payments (30+ days) in the past 12 months. One late payment can disqualify you.
Write a PMI removal request letter
Include: loan number, property address, request for PMI cancellation based on 80% LTV, and statement that you have no late payments. Send via certified mail.
Order a new appraisal
Your lender will require a new appraisal to confirm the home value. Cost: $400-$700. The appraisal must show LTV at or below 80%.
Wait for lender response
The lender must respond within 30 days of receiving your request and appraisal. If approved, PMI is cancelled on your next billing cycle.
Verify PMI is removed
Check your next mortgage statement to confirm PMI is gone. If it is not, contact your servicer immediately and file a CFPB complaint if needed.
PMI Removal: Common Roadblocks & Solutions
⚠ Lender says your home value is too low
Solution: Get a second appraisal or use recent comparable sales (comps) to dispute. You can also wait for automatic cancellation at 78% LTV.
⚠ You have a late payment in the past year
Solution: Wait 12 months from the late payment date, then reapply. Set up autopay to prevent future late payments.
⚠ You have a second mortgage (HELOC)
Solution: Pay down or pay off the second mortgage first. Lenders will not remove PMI if there is a subordinate lien.
⚠ Your property is investment/second home
Solution: HPA protections only apply to primary residences. You must refinance to remove PMI on investment properties.
⚠ Lender ignores your request
Solution: File a complaint with the CFPB at consumerfinance.gov. Lenders face penalties for HPA violations. Most resolve within 15 days of a CFPB complaint.
FHA MIP vs Conventional PMI Removal
| Feature | Conventional PMI | FHA MIP |
|---|---|---|
| Federal Law Protection | Yes (HPA 1998) | No |
| Auto-Cancel at 78% LTV | Yes | No |
| Request Removal at 80% | Yes | No |
| How to Remove | Request or auto-cancel | Refinance only |
| Removal Cost | $0-$700 (appraisal) | $2K-$5K (refi costs) |
| Life of Loan? | No — always cancels | Yes (if <10% down) |
Stop Paying PMI Today
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