Private Mortgage Insurance (PMI) enables individuals to purchase a home with a down payment of less than 20%. If you’re paying PMI, you may wonder if it’s time to stop the monthly payments and redirect those funds towards savings.

Your monthly mortgage payment typically includes contributions to an escrow account for real estate taxes and various insurance types (homeowners, hazard, flood, and PMI). If you put down less than 20% on your home with conventional financing or have an FHA loan, you’re probably paying PMI. This insurance protects lenders against loss if borrowers stop making payments. Unfortunately, many homeowners continue to pay PMI long after it’s necessary, resulting in thousands spent on unnecessary premiums.

The good news is that once you’ve reached 20% equity in your home through appreciation, loan principal reduction, or home improvements, you can request your lender to cancel PMI. To do so, submit a written request for PMI cancellation and provide proof that your property has at least 20% equity. In most cases, a state-certified appraisal is the required proof.

Recent legislation, the Homeowners Protection Act, mandates that lenders inform homeowners of any PMI they’re paying and the requirements to cancel it. However, you don’t need to wait for your lender’s notification to eliminate PMI. If you have 20% or more equity in your home, you can usually cancel PMI quickly with a valid home appraisal.

At Austin Appraisal Group, we specialize in helping homeowners eliminate unnecessary PMI insurance. Before contacting an appraiser, discuss the process with your lender to ensure you understand the requirements. If your lender isn’t helpful, reach out to us, and we’ll guide you through the questions to ask your lender for a better understanding of the process.

We offer an initial consultation to determine whether you have enough equity in your home to cancel your PMI. Don’t let unwanted PMI insurance weigh you down – let us help you free up your finances for other important purposes.

Contact us at 512-655-9775 or complete our free quote request form on this page for a complimentary appraisal quote. Our knowledgeable professionals are eager to address any questions you may have and provide you with an accurate, dependable appraisal that caters to your needs.