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When Does PMI Go Away? The 80% and 78% Rules With Real Numbers

By Smart Budget Sheets November 10, 2026
PMI cancellation at 80% and automatic end at 78%, with a $324k example.

Private mortgage insurance (PMI) on a conventional loan is not forever. In the US, the Homeowners Protection Act sets two milestones, and knowing them can be worth thousands.

The two milestones

  • 80% of the original value: you can ask the lender in writing to cancel PMI once your balance reaches 80% of the home’s original value (usually the purchase price). Lenders typically also want a good payment history and may ask for proof the home has not lost value.
  • 78% of the original value: PMI must end automatically when the balance is scheduled to reach 78%, based on the original amortization schedule, as long as you are current on payments.

FHA loans work differently: with less than 10% down, the annual mortgage insurance premium usually stays for the life of the loan, and the common way out is refinancing into a conventional loan.

Example

$360,000 home, 10% down, $324,000 loan at 6.5% for 30 years: about $2,048 a month for principal and interest.

  • 80% of $360,000 = $288,000. On the normal schedule the balance gets there after about 95 months (just under 8 years).
  • 78% = $280,800, reached after about 109 months (around 9 years).

If PMI costs 0.7% of the loan a year, that is about $189 a month.

What extra principal does

Add $200 a month to principal from day one and the balance hits $288,000 after about 62 months instead of 95. Request cancellation then and you skip roughly 33 months of PMI, about $6,200, on top of the interest saved.

Note the difference: extra payments bring forward the date you can request cancellation. The automatic 78% date follows the original schedule, so you have to ask.

Checklist

  1. Find your original value and current balance on the loan statement.
  2. Divide balance by original value. Under 80%? Ask the servicer for its PMI cancellation requirements.
  3. If prices in your area have risen a lot, ask whether the servicer accepts a new appraisal; some allow cancellation based on current value after a few years.

Free tools

General information, not financial advice. Figures are rounded examples.

#personalfinance #budgeting #mortgage
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