If you have a conventional loan with PMI, you may request it to be removed once the principal balance of the loan reaches 80% of the value of the home. According to the Homeowners Protection Act, a borrower may initiate cancelation of PMI coverage by contacting the servicer. PMI will automatically fall off when the balance reaches 78% of the original value of the home.

Private mortgage insurance is required on loans with less than 20% equity. PMI protects lenders from the risk of default and foreclosure. It allows the lender to recover costs associated with the resale of foreclosed property. The amount of PMI paid per month will depend on your credit score, amount of down payment, whether it is a primary residence, second home, or investment property, and the type of property, i.e. single family residence or condo.

Although PMI can be removed on conventional loans, mortgage insurance on FHA loans is not removable.

If you want more information on PMI, click here: https://www.consumerfinance.gov/compliance/supervision-examinations/homeowners-protection-act-hpa-or-pmi-cancellation-act-examination-procedures/