Mortgage insurance · 12 U.S.C. §4902When does PMI come off? The 80%, 78% and midpoint rules
On a conventional loan with private mortgage insurance, federal law sets three exits (12 U.S.C. §4902). You can ask in writing to cancel once the balance is scheduled to reach – or by your payments actually reaches – 80% of the original value, if you have a good payment history, are current, show the value has not declined if the servicer requires it, and have no second lien. PMI ends automatically on the date the balance is scheduled to reach 78% of the original value if you are current. And it cannot continue past the first day of the month after the midpoint of the loan term if you are current. "Original value" is the lower of the contract price or the appraisal at closing (§4901(12)). No premiums may be charged more than 30 days after cancellation or termination, and unearned premiums must be refunded within 45 days. High-risk loans have different rules, and FHA, VA and USDA insurance is not covered.
The three ways PMI ends
Borrower request at 80%
Written request when the balance is scheduled to reach, or actually reaches, 80% of original value; good history, current, value not declined, no second lien (§§4901(2), 4902(a)).
Automatic at 78%
On the date the balance is first scheduled to reach 78% of original value, if current – or when you become current (§§4901(18), 4902(b)).
Final termination
First day of the month after the midpoint of the amortization period, if current (§4902(c)).
Original value
Lower of the contract sales price or the appraised value at closing; for a refinance, the appraisal used (§4901(12)).
Money back
No premiums more than 30 days after it ends; unearned premiums returned within 45 days (§4902(e), (f)).
Exceptions
High-risk loans follow other rules; FHA, VA and USDA insurance is not private mortgage insurance (§§4902(g), 4901(13)).
How to get PMI removed sooner
- Find the original value: the lower of your contract price and the appraisal at closing.
- Check your amortization schedule for the 80% and 78% dates.
- Extra principal payments can bring the actual 80% date forward – then request cancellation in writing.
- Ask the servicer what proof of value it requires before you order anything.
What a TC can hand the buyer at closing
- The contract price and appraised value – the lower one is the original value.
- The PMI disclosure in the loan documents.
- A reminder task for the scheduled 80% date.
Questions homeowners ask
When does PMI automatically come off?
When the balance is first scheduled to reach 78% of the original value, if you are current on payments (12 U.S.C. §4902(b)).
Can I remove PMI at 80%?
Yes, by written request, with a good payment history, current payments, proof the value has not declined if required, and no second lien (§4902(a)).
Does the Homeowners Protection Act apply to FHA loans?
No. It covers private mortgage insurance; FHA, VA and USDA insurance is excluded from the definition (§4901(13)).
Related guides
Keep the appraisal and contract price on the deal in ClosingCode, and set a follow-up task for the buyer's 80% PMI date.
Start free trialSource: Homeowners Protection Act, 12 U.S.C. §§4901 and 4902 (govinfo.gov, read October 25, 2026).
General information, not legal or financial advice. ClosingCode is software; it is not a law firm, lender or brokerage. This guide is not a substitute for the advice or services of an attorney.