On a conventional loan, you can request PMI cancellation once your principal balance reaches 80% of the original home value — or earlier if your home has appreciated. Making extra principal payments, requesting a new appraisal after significant appreciation, or refinancing are the three main acceleration strategies. FHA mortgage insurance follows different rules and may require a refinance to eliminate.
The Homeowners Protection Act (HPA) gives conventional mortgage borrowers the right to cancel PMI at 80% LTV and requires automatic termination at 78% LTV based on the original amortization schedule — but you don't have to wait that long. The CFPB's PMI explainer outlines the three main routes to early cancellation.
Every extra dollar applied to principal reduces your balance toward the 80% threshold. Even one extra payment per year can shave years off your PMI obligation. Use your lender's amortization tool — or the CFPB's mortgage payoff calculator — to model how additional monthly payments accelerate your cancellation date. When your balance hits 80% of the original purchase price, submit a written cancellation request to your servicer. You must be current on payments and may need to certify no subordinate liens.
If your home has appreciated significantly, your current LTV may already be below 80% even without extra payments. Most lenders allow a borrower-requested appraisal after two years of on-time payments (some require five years). If the appraisal establishes that your balance is at or below 80% of current market value, you can request PMI cancellation. The appraisal typically costs $300–$600 and must be ordered through the lender, not independently. Check your servicer's specific seasoning requirements before ordering.
Refinancing into a new conventional loan with at least 20% equity eliminates PMI entirely on the new loan. This also resets your loan term and rate, so run the full break-even analysis — closing costs typically run 2%–5% of the loan amount. Refinancing is the primary path for FHA borrowers who want to escape MIP, since FHA MIP on loans originated after June 2013 with less than 10% down does not automatically cancel.