If you pay private mortgage insurance (PMI) every month, you can usually stop, and the route depends on your loan type and how much equity you have. This guide shows how to remove PMI from a mortgage in sequence: confirm the insurance type, calculate your thresholds, request cancellation, try a reappraisal, and refinance if cancellation is not available. Duane Buziak applies the same order with homeowners in Virginia, Florida, Tennessee, and Georgia. Before you start, gather your latest mortgage statement, your original closing documents, and a rough idea of your home’s current value.
Step 1: Confirm You Have PMI and Not Another Type of Mortgage Insurance
PMI applies only to conventional loans. FHA loans carry a mortgage insurance premium (MIP), and USDA loans carry an annual fee. Both follow different removal rules. For FHA loans with a down payment under 10%, MIP often lasts for the life of the loan. Rules change, so confirm your situation on HUD.gov’s FHA loan page as of 2026.
To find your insurance line, check these places:
- The monthly breakdown on your mortgage statement, usually labeled “mortgage insurance” or “PMI.”
- The projected payments section of your Closing Disclosure.
- Your escrow account breakdown, if the servicer collects insurance with your payment.
Next, identify how the PMI is paid. Borrower-paid monthly PMI appears as its own charge, and this is the type you can cancel. Lender-paid PMI is built into your interest rate in exchange for no separate premium. It cannot be canceled, and the usual way to eliminate it is a refinance. If your closing paperwork mentions a higher rate “in lieu of mortgage insurance,” you likely have lender-paid PMI.
Decision point: if you have FHA MIP, a USDA fee, or lender-paid PMI, skip to Step 6 and consider a conventional refinance. If you have borrower-paid monthly PMI, continue to Step 2.
Step 2: Find Your Loan’s Original Value and Current Balance
Loan-to-value (LTV) is your loan balance divided by the property’s value. For scheduled removal, PMI rules use the original value, meaning the lesser of the purchase price or the appraised value at closing. They do not use what the home might sell for today.
Pull two numbers:
- The original value from your Closing Disclosure (purchase price and appraised value, whichever is lower).
- Your current principal balance from your latest mortgage statement.
Mistake to avoid: plugging in a current market estimate when working out the automatic and 80% request thresholds. Market value matters only for reappraisal requests, covered in Step 5.
This guide uses one illustrative loan throughout. Suppose you bought a home for $400,000, and it appraised at the same amount. You put 10% down and borrowed $360,000, so your starting LTV is 90%, which is why PMI applies. Two target balances follow from the original value:
- 80% target: $400,000 × 0.80 = $320,000
- 78% target: $400,000 × 0.78 = $312,000
Those figures stay fixed as long as the original value does. Only your balance moves, and the next step shows when it gets there.
Step 3: Know the Three Thresholds and When Each Applies
Under the federal Homeowners Protection Act (HPA), three points matter, as outlined on the CFPB’s page on canceling PMI:
- 80% of original value: you may request cancellation in writing.
- 78% of original value: PMI terminates automatically if you are current on payments.
- Midpoint of the amortization schedule: final termination, the month after the midpoint (month 181 on a 30-year loan), even if you have not reached 78%.
A common misconception is that PMI drops automatically at 80%. It does not. At 80% you must ask. Only at 78% does it end on its own.
Worked example. Take the $360,000 loan at a fixed 6.5% over 30 years. This rate is an assumption for the math, not a market quote. The principal and interest payment is about $2,275. Following the amortization schedule:
- The balance falls below $320,000 at payment 95, roughly 7 years and 11 months in.
- The balance falls below $312,000 at payment 109, roughly 9 years and 1 month in.
That is a 14-month gap. Assume, for illustration only, that PMI costs 0.5% of the loan annually, or $150 per month. Requesting cancellation at month 95 instead of waiting for automatic termination saves 14 × $150 = $2,100. PMI rates vary with credit score and LTV, so treat the $150 as an example, not a market claim.
Servicers may add conditions beyond the statute, so check your servicer’s policy before you count on a date.
Step 4: Submit a Written Cancellation Request at 80% LTV
The request must be in writing. Call your servicer first and ask for its cancellation requirements and its mailing address or portal instructions. Then send the request the way the servicer specifies.
Servicers commonly require the following, so confirm each one with yours:
- A good payment history: no payment 30 days late in the past 12 months and none 60 days late in the past 24 months.
- No subordinate liens, such as a second mortgage or HELOC, on the property.
- A property value that has not declined below the original value. Some servicers ask for evidence, such as a valuation.
Reaching 80% sooner
Extra principal shortens the wait. Options include adding a set amount to each payment, making a lump-sum payment, or switching to biweekly payments. In every case, tell the servicer in writing to apply the extra funds to principal, or they may be held as an early payment on the next installment. In the example above, an extra $200 a month would pull the 80% date meaningfully earlier than month 95.
Following up
- Keep a copy of the request and the date you sent it.
- Calendar a response date, such as 30 days out.
- Ask for written confirmation of the cancellation effective date.
- Ask for a refund of any unearned premium.
Step 5: Request Cancellation Early Using a Reappraisal
If your home has gained value or you have made improvements, you can ask the servicer to use the current value to reach 80% LTV. This is a servicer-discretion option, not a federal right, so the servicer can set the terms or decline.
Suppose your home is now worth $450,000 and your balance is $340,000. On original value, you are at 85% and still waiting. On current value, you are at about 75.6%. A reappraisal could remove PMI years ahead of schedule.
Typical requirements, which you should verify with your servicer, include a minimum seasoning period. For loans owned by Fannie Mae, the servicing standards are in its Servicing Guide, section B-8.1-02 on termination of conventional mortgage insurance. Seasoning is commonly two to five years depending on the LTV reached, and the thresholds can change, so confirm the current figures before you order anything. Loans owned by other investors may follow different guidelines. Ask your servicer who owns your loan.
Costs and risk:
- You usually pay for the appraisal, often several hundred dollars.
- If the value comes in low, you pay for nothing and PMI stays.
- Compare the appraisal fee against your monthly PMI savings first. At $150 a month, a $500 appraisal pays for itself in about four months.
Use the appraiser the servicer requires. An outside appraisal you commission yourself may be rejected, which would waste the fee.
Step 6: Refinance to Drop PMI When Cancellation Is Not Available
Refinancing makes sense in these situations:
- You have lender-paid PMI, FHA MIP, or a USDA annual fee.
- Your servicer denies a reappraisal.
- A new rate is competitive with your current one.
The new loan needs 80% LTV or less on its own appraisal to avoid PMI, so confirm your equity first. Then run a breakeven: closing costs divided by monthly savings.
Illustrative comparison. Assume a $300,000 balance with lender-paid PMI built into a 7.25% rate. At that rate, principal and interest is about $2,047. Assume a refinance to 6.5% with no PMI, where the payment is about $1,896. Monthly savings are roughly $150. If closing costs are an assumed $6,000, breakeven is $6,000 ÷ $150 = 40 months. If you expect to keep the home longer than about three and a half years, the refinance pays for itself. All figures here are assumptions for the math, not offers.
A lender with a single rate sheet can offer only its own pricing and PMI structures. Duane Buziak shops hundreds of wholesale lenders through Mortgage Mastermind by Duane Buziak to find the program and PMI structure that fits your file. NoTouch Credit Pull lets you review options through a soft-pull pre-approval, with no hard inquiry, before you decide to proceed.
State data point: confirm your state and county before relying on any limit. As of 2026, the FHFA baseline conforming loan limit is $832,750 for a one-unit property, with higher ceilings in designated high-cost areas such as parts of Northern Virginia. See the FHFA 2026 conforming loan limit announcement. Loans above your area’s limit are jumbo loans with different mortgage insurance and pricing rules.
Step 7: Verify the PMI Is Gone and Fix Escrow
Check your next statement for the removed charge and a recalculated payment. Compare it against the servicer’s written confirmation. In the example, the payment should drop by the $150 PMI line.
If you escrow, ask for an escrow analysis. The HPA requires the servicer to return unearned premiums within 45 days of cancellation or termination, per the CFPB’s PMI guidance. If the refund has not arrived, ask for it in writing. If the servicer refuses or stalls, file a complaint through the CFPB complaint portal.
The comparison below shows how PMI removal by refinance differs between an independent broker and a typical direct lender.
| Feature | Duane Buziak | Typical Direct Lender | Why It Matters |
|---|---|---|---|
| Pricing source | Hundreds of wholesale lenders compared per file | One internal rate sheet | More options to fit your PMI and rate goals |
| Application path | One application, multiple programs evaluated | One application, one lender’s programs | A broader search without repeating paperwork |
| Credit pull for first look | NoTouch Credit Pull (soft pull, no hard inquiry) | Varies by lender | Compare options before a hard inquiry |
| PMI structure choices | Can compare monthly, lender-paid, or no-PMI structures | Limited to that lender’s offerings | The right structure depends on how long you keep the loan |
Frequently Asked Questions
Does PMI go away automatically at 80% LTV? No. At 80% of original value you must request cancellation in writing. Automatic termination occurs at 78% if you are current.
Does my home’s current value count toward the 78% and 80% rules? No. Those rules use the original value, the lesser of purchase price or appraised value at closing. Current value matters only if the servicer allows a reappraisal request.
Can I cancel lender-paid PMI? No. It is built into the rate, so eliminating it usually requires a refinance.
Does FHA MIP work like PMI? No. FHA MIP follows separate rules and often lasts the life of the loan when the down payment was under 10%. Verify on HUD.gov as of 2026.
What if my servicer denies my request? Ask for the specific reason in writing, fix any issue such as a subordinate lien or late payment, and reapply. If you believe the denial violates the HPA, file a CFPB complaint.
How long does a servicer have to refund unearned premiums? The HPA requires the refund within 45 days of cancellation or termination. Confirm details on the CFPB page.
Is Mortgage Mastermind by Duane Buziak a broker or a direct lender? Duane Buziak operates as a broker and lender, licensed in Virginia, Florida, Tennessee, and Georgia among other states, and shops hundreds of wholesale lenders per file. South Carolina is broker-only.
Can I see refinance options without a hard credit pull? Yes. NoTouch Credit Pull provides a soft-pull pre-approval with no hard inquiry.
Mortgage and PMI guidance from Duane Buziak, Mortgage Maestro, NMLS #1110647.
Mark Your Dates and Call When Cancellation Is Off the Table
Write down two dates today: the month your balance reaches 80% of original value, and the month it reaches 78%. Send your written cancellation request as soon as the first date arrives, then confirm the effective date and the premium refund. If lender-paid PMI, FHA MIP, or a servicer denial blocks cancellation, call Mortgage Mastermind by Duane Buziak at 804-212-8663 for a no-pressure refinance review.
Ready to experience the award-winning service that earned us VA Broker of the Year and recognition as a top 1% nationwide mortgage broker? Schedule your no-pressure consultation today and discover how our customized financing strategies across VA, FL, TN, and GA can help you achieve your homeownership or investment goals with credit-safe inquiries and expert guidance every step of the way.
