Canceling Private Mortgage Insurance

While lenders have been legally required (for loans closed after July 1999) to cancel Private Mortgage Insurance (PMI) when the loan balance goes under 78% of the purchase price, they do not have to cancel PMI automatically if the borrower's equity is more than 22%. (A number of "higher risk" mortgage loans are excluded.) But if your equity reaches 20% (no matter what the original price was), you can cancel PMI (for a mortgage loan that past July 1999).

Do your homework

Study your loan statements often. Make yourself aware of the selling prices of other homes in your neighborhood. If your mortgage is under five years old, chances are you haven't made much progress with the principal � it's been mostly interest.

Verify Eligibility

When you determine you have achieved at least 20 percent equity in your home, you can begin the process of canceling your Private Mortgage Insurance. First you will tell your lender that you are asking to cancel PMI. The lending institution will require documentation that your equity is high enough. The best proof there is can be found in a state certified appraisal using form URAR-1004 (Uniform Residential Appraisal Report), which is required by most lenders before canceling PMI.

Chase Mortgage can help find out if you can eliminate your PMI. Call us at 435-755-6622.