Goodbye, PMI!

While lenders have been legally required (for loans closed after July '99) to cancel Private Mortgage Insurance (PMI) when the balance dips under 78% of the purchase price, they do not have to take similar action if the equity is more than 22%. (There are exceptions -like some loans considered 'high risk'.) But you have the right to cancel PMI yourself (for loans made past July 1999) once your equity gets to 20 percent, no matter the original purchase price.

Do your homework

Analyze your statements often. Pay attention to the selling prices of other houses in your neighborhood. If your loan is under five years old, probably you haven't made much progress with the principal � it's been mostly interest.

Proof of Equity

You can begin the process of canceling your PMI when you calculate that your equity has reached 20%. First you will notify your lender that you are requesting to cancel your PMI. Lending institutions request documentation verifying your eligibility at this point. A state certified appraisal documented on the appropriate form (URAR-1004 - Uniform Residential Appraisal Report) is all the proof you need � and your lender will probably request one before they agree to cancel.

F&T Mortgage, Inc. NMLS # 168839 ( can help find out if you can eliminate your PMI. Give us a call: 214-300-8756.

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