You can remove PMI on a conventional loan by asking your servicer in writing once your balance reaches 80% of your home's original value, or wait for it to end automatically at 78% if you're current on payments. If your home's value has gone up, Fannie Mae and Freddie Mac also let you request removal based on today's value: generally 75% loan-to-value after two to five years, or 80% after five years, with a clean payment record and a new valuation. FHA mortgage insurance is a different program with different rules, and on many FHA loans the only way out is refinancing.
I'm Taylor Ring, a Mortgage Loan Officer with Fairway Independent Mortgage Corporation (The Wood Group) in Belton. Conventional buyers I work with in Georgetown, Round Rock, and Temple often put down less than 20%, and "When can I get rid of PMI?" is one of the first questions after closing. This guide uses the federal Homeowners Protection Act, the CFPB, and the Fannie Mae and Freddie Mac servicing guides, read October 23, 2026. Your servicer, not your loan officer, makes the final call on your loan.
Thinking about buying, or about refinancing to drop mortgage insurance? Get Pre-Approved or Book a Free Consultation.
First, Check Which Kind of Mortgage Insurance You Have
"PMI" gets used for every kind of mortgage insurance, but the removal rules depend on the loan.
| Loan | What you pay | Can you cancel it? |
|---|---|---|
| Conventional | Private mortgage insurance (PMI) | Yes: by request at 80%, automatically at 78%, at the midpoint, or by current value under Fannie/Freddie rules |
| FHA | FHA mortgage insurance premium (MIP), upfront and annual | Not like PMI; depends on when the loan was endorsed and its LTV, and often lasts the life of the loan |
| VA | No monthly mortgage insurance; the VA guaranty replaces it (CFPB) | Not applicable |
| USDA | Upfront and annual guarantee fees | Set by USDA's program rules, not the PMI law |
The CFPB is clear that mortgage insurance, no matter what kind, protects the lender, not you. The federal PMI law also excludes FHA, VA, and USDA insurance from its definition of private mortgage insurance. If you have an FHA loan, skip to the FHA section near the end, or read my FHA mortgage insurance guide. For USDA and VA costs, see USDA loan requirements in Texas and the VA funding fee in Texas.
The Federal Rules: Homeowners Protection Act
The Homeowners Protection Act (12 U.S.C. 4901-4910) covers borrower-paid PMI on single-family principal residence mortgages that closed on or after July 29, 1999. The CFPB notes that lender-paid mortgage insurance follows different rules.
1. Ask to Cancel at 80%
You can request cancellation on the date your balance is first scheduled to reach 80% of the original value, or earlier if you've paid extra and your balance actually reaches 80%. The CFPB says the first scheduled date should appear on the PMI disclosure you got at closing.
Your servicer must cancel if you:
- Ask in writing
- Have a good payment history: under the law, no payment 30 days or more late in the last 12 months, and no payment 60 days or more late in the 12 months before that
- Are current on your payments
- Show, if the lender requires it, that the property's value hasn't dropped below the original value (for example, with an appraisal)
- Certify that your equity isn't encumbered by a subordinate lien, such as a second mortgage or home equity line
That last point trips people up. If you've opened a HELOC, it can affect a PMI cancellation request. My HELOC in Texas guide covers how those liens work.
2. Automatic Termination at 78%
Even if you never ask, PMI must terminate automatically on the date your balance is first scheduled to reach 78% of the original value, based on the original amortization schedule, as long as you're current. If you're behind on that date, it ends the first day of the month after you catch up.
3. Final Termination at the Midpoint
If PMI hasn't ended any other way, it can't be required past the first day of the month after the midpoint of the loan's amortization period, if you're current. On a 30-year loan, the CFPB notes that's after 15 years. This mostly matters for loans with interest-only periods, principal forbearance, or balloon payments.
Deadlines for Your Servicer
- No more PMI charges more than 30 days after cancellation or termination (for a request, 30 days after the later of your request or your meeting the value and lien requirements)
- Unearned premiums returned within 45 days
What "Original Value" Means
For a purchase, original value is the lower of the contract sales price or the appraised value at closing. For a refinance of your principal residence, it's the appraised value the lender relied on for the refinance.
The High-Risk Exception
The law lets loans classified as high risk at closing stay outside the 80% and 78% rules. For conforming-size loans, that's under Fannie Mae and Freddie Mac guidelines. For other loans, PMI must still end when the balance is first scheduled to reach 77% of original value, and the midpoint rule applies to all of them.
Removing PMI Based on Today's Value (Fannie Mae and Freddie Mac)
The CFPB points out that Fannie Mae and Freddie Mac set their own cancellation guidelines, which can't be less favorable than the law. The big one: you can use your home's current value, not just the original value.
| Loan secured by | Seasoning | Maximum LTV on current value |
|---|---|---|
| One-unit principal residence or second home | 2 to 5 years | 75% |
| One-unit principal residence or second home | More than 5 years | 80% |
| One-unit principal residence or second home, with substantial improvements | Two-year minimum waived | 80% |
| Investment property or 2-4 unit principal residence | More than 2 years | 70% |
That table matches Fannie Mae Servicing Guide B-8.1-04 and, for one-unit homes, Freddie Mac Guide Section 8203.2.
Payment record for both: the loan must be current, with no payment 30+ days late in the last 12 months and no payment 60+ days late in the last 24 months. Fannie Mae requires a borrower who assumed the loan to have a 24-month payment history for a current-value request.
What counts as an improvement: Fannie Mae gives kitchen and bathroom renovations and added square footage as examples. Freddie Mac lists significant structural alterations, construction requiring permits, adding new components that didn't exist before, and energy-efficient replacements. Both say routine repairs and replacing like with like don't count.
How value is proven:
- Fannie Mae: the servicer orders a valuation based on an interior and exterior inspection through Fannie Mae's system.
- Freddie Mac: a new broker price opinion or appraisal, at the borrower's expense, done no later than 120 days after the request.
A 2026 change: Fannie Mae Lender Letter LL-2026-07 (September 16, 2026) now lets servicers reach out to borrowers who may be close to qualifying on current value. Before that, Fannie's guide said current-value removal had to be borrower-initiated. You still don't have to wait for a letter. Freddie Mac's guide already allowed servicers to identify and notify borrowers.
A Hypothetical Walkthrough
Hypothetical numbers, not a real loan: You buy a Temple home for $300,000 with 10% down, a $270,000 loan. The appraisal came in at the price, so original value is $300,000.
| Milestone | Balance needed |
|---|---|
| Request cancellation (80% of original value) | $240,000 |
| Automatic termination (78% of original value) | $234,000 |
Three years in, your balance is $255,000, still above $240,000. But suppose a new valuation puts the home at $360,000. Your current-value LTV is $255,000 / $360,000, about 70.8%. That's under the 75% limit for a loan seasoned two to five years, so with a clean payment record, you'd likely qualify under Fannie Mae or Freddie Mac rules. If the valuation came in at $330,000 instead, LTV would be about 77.3%, and you'd need to pay down to $247,500 (75% of $330,000) or wait.
Step-by-Step: How to Ask Your Servicer
- Confirm who owns your loan. Ask your servicer whether Fannie Mae, Freddie Mac, or someone else holds it, and whether your MI is borrower-paid or lender-paid.
- Find your PMI disclosure and amortization schedule. They show your 80% and 78% dates.
- Check your payment record against the 12- and 24-month tests.
- Decide which route fits: original value (scheduled or actual balance) or current value.
- Make the request in writing, even if you call first. The federal 80% right is tied to a written request.
- Ask what value evidence the servicer requires and what it costs before you order anything.
- Watch your next escrow statement. Fannie Mae requires the servicer to stop collecting the premium and notify you within 30 days; the law requires unearned premiums back within 45 days.
Ways to Get There Sooner
- Extra principal payments. Under the law, the 80% request can be based on your actual balance, so prepaying moves the date up.
- Qualifying improvements that raise value, under the current-value rules above.
- Refinancing. If rates and your equity line up, a new loan at 80% LTV or less wouldn't need PMI. That's a new loan with its own costs, so compare them with what you'd save. My refinance loans page covers the options.
How FHA Mortgage Insurance Is Different
FHA's annual MIP isn't PMI and the Homeowners Protection Act doesn't cover it. HUD's current chart sets the MIP duration at origination. For most 30-year FHA loans:
- LTV 90% or less at origination: annual MIP for 11 years
- LTV above 90%: annual MIP for the mortgage term
HUD's MIP cancellation rules don't use a new appraised value. For many FHA borrowers, the practical way to stop paying it is refinancing into a conventional loan once there's enough equity and the numbers make sense. My FHA vs. conventional guide compares the two, and the FHA mortgage insurance guide has HUD's full chart and the rules for older loans.
Frequently Asked Questions
When can I remove PMI from my conventional loan?
Under the Homeowners Protection Act, you can ask your servicer in writing to cancel PMI when your balance is scheduled to reach, or actually reaches, 80 percent of your home's original value. You need a good payment history, current payments, no subordinate lien on your equity, and proof the value has not declined if the servicer requires it.
Does PMI go away automatically?
Yes. For borrower-paid PMI on a principal residence loan that closed on or after July 29, 1999, the servicer must end PMI on the date the balance is first scheduled to reach 78 percent of the original value, as long as you are current. If not, it must end no later than the month after the midpoint of the loan term.
Can I remove PMI based on my home's current value?
Fannie Mae and Freddie Mac allow it. For a one-unit principal residence or second home, the loan-to-value ratio based on current value must be 75 percent or less if the loan is two to five years old, or 80 percent or less after five years. You need a clean payment record and a new valuation, which Freddie Mac says is at the borrower's expense.
Do I need an appraisal to remove PMI?
It depends on the route. For a request based on original value, the servicer can require evidence that the value has not dropped below the original value. For current-value removal, Fannie Mae requires a valuation based on an interior and exterior inspection, and Freddie Mac requires a broker price opinion or appraisal.
Can I remove mortgage insurance on an FHA loan the same way?
No. FHA mortgage insurance is not covered by the Homeowners Protection Act. On current FHA loans, annual MIP lasts 11 years if the loan-to-value ratio was 90 percent or less at origination and for the life of the loan otherwise. Many FHA borrowers drop it by refinancing into a conventional loan once they have enough equity.
Want to Know Your PMI Date?
Send me your loan details and I'll map your 80%, 78%, and current-value options, and tell you honestly whether a refinance is worth pricing.
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Related Guides
- Conventional Loans
- Refinance Loans in Texas
- FHA Mortgage Insurance in Texas
- FHA vs. Conventional Loans in Texas
- HELOC in Texas
- How Much House Can I Afford in Texas?
Sources
- Homeowners Protection Act: 12 U.S.C. 4901 (definitions) and 12 U.S.C. 4902 (termination)
- CFPB: When can I remove PMI? and What is mortgage insurance?
- Fannie Mae: Servicing Guide B-8.1-04, Termination of Conventional Mortgage Insurance and Lender Letter LL-2026-07
- Freddie Mac: Seller/Servicer Guide Section 8203.2
- HUD Handbook 4000.1, Appendix 1.0 Mortgage Insurance Premiums
Taylor Ring, NMLS #2809683 | Fairway Independent Mortgage Corporation, NMLS #2289 | The Wood Group of Fairway, 127 Lake Rd Ste 300, Belton, TX 76513 | Equal Housing Opportunity. This is not a commitment to lend. All loans are subject to credit approval and program guidelines, and approval, rates, and program availability are not guaranteed. Mortgage insurance cancellation decisions are made by your loan servicer and investor, not by your loan officer. This article is general information, not legal or tax advice, and is not affiliated with or endorsed by the CFPB, Fannie Mae, Freddie Mac, HUD, or any government agency.