Mortgage insurance is a monthly inclusion every home owner deals with. It spans the life of the loan and can get costly. However there are two ways that you can remove your PMI from your mortgage loan: “Requesting a cancellation” or “a demand automatic termination.” But what does that mean for you?
There are a few things to consider with each request. If you choose “requesting” cancellation, according to the Homeowners Protection, only when the mortgage’s principal balance has decreased to 80% of the original value a homeowner can make a request to the lender to cancel the PMI. This can be done a few different ways either by a written request or by phone.
If you’re going to go with “a demand for automatic termination” there are a few things to consider. You may request an automatic termination, by one, the original value must 78% paid off, or two, when the loan is at “midpoint,” typically 15 years. You must have a 24 month on-time payment to make this request.
Determining whether or not you want to terminate your PMI may take some time. There are lots of steps to take, but with the right guidance you can get the right terms.