Removing PMI from a conventional loan: a step checklist

Last updated: January 15, 2026

What to have ready before you ask to drop PMI

To ask for PMI to come off a conventional loan, you need three things: your home's original value, your current loan balance and a record of your payments. Original value means the value your loan was based on when you got it. According to the CFPB, you can ask once your balance is on schedule to hit 80% of that value. Your servicer is the company that collects your monthly payment, and it may not be the lender that made your loan.

These rules cover borrower-paid PMI on a conventional loan only. Mortgage insurance on a Federal Housing Administration (FHA) loan or a U.S. Department of Agriculture (USDA) loan works differently.

• Your closing papers show the value your loan was based on.
• Your latest mortgage statement shows today's principal balance and the PMI charge.
• Your servicer can send a record of your payments, or you can print one from your online account.
• Ask your servicer for your payment schedule if you don't have it. That table shows how each payment lowers the balance.
• The address for written requests is usually on your statement.

If your papers live in one folder, this is an evening's work. None of it asks for tax returns. The conditions the CFPB lists are about your balance and your payments, which is good news if your returns show less than you make.

Step 1: Find your original value and your 80% and 78% marks

Your 80% mark is your home's original value times 0.80, and your 78% mark is that value times 0.78. The CFPB uses both marks for PMI on a conventional loan.

Say your original value was $500,000, as an example. Times 0.80, that's $400,000. Times 0.78, it's $390,000. The table shows what each balance triggers under the CFPB's rules, and what you'd have to meet at each one.

Both marks are measured against the original value. What your home is worth today doesn't move them.

"Scheduled" points to your payment schedule: the month your regular payments alone bring the balance down to each mark. If you've paid extra principal, ask your servicer whether that changes your date. I'd write down both dollar amounts and the month you hit each one. With those on paper, Step 1 is finished.

Step 2: Check your payment history

Your payment record has to be clean before a servicer will cancel PMI on request. According to the CFPB, you need a good payment history to ask at 80%, and current payments for the automatic drop at 78%.

Current means nothing is past due today. A good history looks further back, and your servicer decides how far. So ask it how many months it reviews.

If a payment is behind, bring it current before you send the request. A late payment on the account gives the servicer an easy reason to say no.

You know this step is done when your history shows every payment on time and nothing past due.

Step 3: Send a written request to your servicer

You start PMI cancellation with a written request to your servicer. According to the CFPB, you can ask once you're on schedule to hit the 80% mark. This step is finished when the servicer writes back with what it needs or the date the PMI stops.

1. Your loan number and address. Put both at the top so the letter lands on the right file.
2. A plain request. Say you are asking to cancel borrower-paid PMI because your balance has reached the 80% mark.
3. Your numbers. List the original value, today's balance and your 80% mark from Step 1.
4. A request for conditions. Ask for every condition it applies, plus any appraisal rules and fee.
5. A copy for you. Keep it with the date you sent it.

A servicer may add its own conditions beyond the CFPB's list. Ask for the full list on the first call, then ask for that same list on paper.

Step 4: Decide whether a new appraisal is worth paying for

A new appraisal makes sense only if your servicer accepts current value for PMI removal. Your home also has to have gained enough to meet the servicer's own rule for that new value. Ask for those rules and the appraisal fee before you order one.

An appraisal is a licensed appraiser's opinion of what your home is worth now. If your servicer accepts current value and your home has gained, a new appraisal can bring the request date closer than your payment schedule would.

I can't tell you the fee, the share of value it wants or how long you must have owned the home. Those come from your servicer. Ask too whether it has to order the appraisal itself, because one you buy on your own may not count.

Then compare. Add up the PMI you'd pay between now and your scheduled 80% date, and set the fee beside it. If your date is only a few months off, I'd usually wait. Once you hold the rules and the fee in writing and have run that comparison, you're ready to decide.

Step 5: Confirm the PMI is gone from your statement

You know PMI is gone when your next monthly statement shows no mortgage insurance charge. If you never asked, the CFPB says your servicer must end it automatically at the 78% mark as long as your payments are current.

Look at the part of the statement that splits your payment into principal, interest, escrow and mortgage insurance. That last line should read zero or be missing.

Call your servicer and ask why if the charge is still there once your balance hits the CFPB's 78% mark. Follow the call with a letter so there's a record.

Once one full statement shows your payment with no mortgage insurance in it, you're finished.

Common mistakes when removing PMI

The most common mistake is assuming an FHA loan drops its mortgage insurance the way a conventional loan does. The U.S. Department of Housing and Urban Development (HUD) runs a different clock. On an FHA loan longer than 15 years, the annual premium runs 11 years if the loan starts at 90% of value or less. Above that, it lasts for the life of the loan.

According to HUD, an FHA loan also carries an upfront premium of 1.75% of the base loan. The annual rates are in the table. So the CFPB's 80% and 78% marks do nothing for an FHA loan. Its insurance runs on HUD's clock.

The second mistake is checking your balance against today's value. Both CFPB marks use the original value, so a rising market alone doesn't trigger anything unless your servicer accepts a new appraisal.

The third is thinking removal depends on your down payment. On a conventional loan, the CFPB says borrowers who put down less than 20 percent of the purchase price typically pay for mortgage insurance. FHA, USDA and VA loans have their own rules. Getting PMI off runs on your balance and your payments instead.

The fourth is keeping PMI because it feels like a safety net. According to the CFPB, mortgage insurance protects the lender, not you, if you fall behind. That's no reason to keep paying it longer than you have to.

Whether PMI you've paid affects your taxes is a question for your CPA.

Should you refinance just to drop PMI?

In my view, refinancing to drop PMI rarely beats a simple cancellation request, because a refinance means qualifying again with income documents. For a self-employed owner, that usually means tax returns again. I'd refinance for a reason of its own.

If your accountant wrote off everything legal, a refinance puts those thin returns back in front of an underwriter. I'm a broker, so I shop one file across a network of wholesale lenders. Different lenders want different deals, and some take bank statements instead, which I explain in bank-statement loans for self-employed buyers.

If you're weighing a refinance anyway, the example below shows a new loan that starts at 80% of the home's value. Compare it with your current loan's rate and APR, line by line, before you decide anything.

Example: a $400,000 30-year fixed loan at 6.06% (6.131% APR) with 20% down ($100,000) on a $500,000 home has 360 monthly payments of $2,413.65 in principal and interest. The APR assumes 0.75 discount points ($3,000, the median paid by 2023 home buyers who paid points, according to the CFPB) and no other lender fees. Taxes and insurance are not included, so the actual payment will be higher. The rate is the market average for January 15, 2026 from Freddie Mac Primary Mortgage Market Survey; yours depends on your credit, loan and property.

How I know this

I've worked as a broker for 21 years at Rate Rebel (NMLS #282828), and this checklist rests on the CFPB's own PMI rules. The 80% request mark and the 78% automatic mark are the CFPB's, both measured against original value. The FHA premium figures come from HUD. The example rate is Freddie Mac's market average for January 15, 2026.

What comes next after you ask

Check your latest statement against the CFPB's 80% mark today. Reached it with clean payments? Send the written request. If you're close and your home has gained value, ask your servicer about its appraisal rules. Otherwise, the CFPB has your servicer end borrower-paid PMI on a conventional loan at 78%, as long as your payments are current.

If a refinance makes sense for some other reason, run your numbers first. The free calculators on my site show the payment in a few minutes with no credit pull, and my guide to bank-statement loans covers qualifying without leaning on your returns.

Before you rely on any mark here, check it twice: once against the CFPB's PMI page, once against your servicer's written conditions for your loan. If the two don't line up, ask the servicer to explain the difference in a letter.

I'd ask in writing at the CFPB's 80% mark once your payments are clean. An appraisal is worth its fee when your servicer will use today's value and the fee looks small next to the PMI you'd stop paying. Otherwise, the automatic 78% drop does the work. I'd save a refinance for a different reason, since it means qualifying on income again.

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