PMI cancellation isn't a favor your lender does for you. It's a legal right, written into a federal law most homeowners have never heard of: the Homeowners Protection Act of 1998, often called the HPA or the PMI Cancellation Act.
Knowing what this law guarantees changes the conversation with your servicer. You're not asking permission — you're invoking a right.
What the HPA Covers
The HPA applies to private mortgage insurance on most conventional residential mortgages. It does not govern FHA mortgage insurance (MIP), which follows separate rules. For conventional borrowers, the HPA sets out three core protections.
1. Borrower-Requested Cancellation at 80%
You have the right to request that PMI be canceled once your loan-to-value ratio reaches 80%. This request can be based on your home's current market value — not only the original purchase price. The servicer can require that you be current on payments, have a good payment history, and may ask for evidence of value such as an appraisal.
The 80% line
PMI can be requested below 80% LTV.
Below 80%
You can request PMI cancelation in writing.
At 78% (scheduled)
By law, your servicer must remove PMI.
2. Automatic Termination at 78%
The servicer must automatically cancel PMI when your balance is scheduled to reach 78% of the original value, based on the amortization schedule, provided you're current on payments. No request is required — but this trigger ignores appreciation entirely.
3. Midpoint Termination
If neither threshold is reached sooner, PMI must end at the midpoint of the loan term — year 16 of a 30-year loan — as long as you're current on payments.
The 80% request is the powerful one. It's the only trigger that lets you use your home's current value, and it's the only one you control. The 78% and midpoint rules just set the latest dates PMI can possibly survive.
What the Law Requires of Servicers
The HPA also imposes duties on servicers. They must provide annual notice of your right to cancel PMI, supply contact information for cancellation requests, and refund unearned premiums when PMI is terminated. A servicer that ignores a valid request or drags its feet may be acting in violation of federal law.
- Annual written notice of your cancellation and termination rights.
- A way to reach the servicer about PMI cancellation.
- Prompt action on valid cancellation requests.
- Refund of unearned PMI premiums after termination.
When a Servicer Won't Comply
If a servicer denies a clearly valid request or stonewalls, the HPA gives it teeth — borrowers can pursue remedies, and complaints can be filed with the Consumer Financial Protection Bureau. Often, simply citing the specific HPA provision in writing is enough to get a stalled request moving.
The Bottom Line
The Homeowners Protection Act means PMI is temporary by law. The 80% borrower-requested cancellation is your strongest lever, because it lets you act on your home's current value rather than waiting on an old schedule.
PMI Ninja builds every cancellation request around your HPA rights — citing the right provisions, meeting the servicer's lawful conditions, and pushing back when a servicer tries to ignore the law.
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