Debbie, Congrats on making it down to 80% on your mortgage!! I would think that if you call your mortgage company, they would be able to help you. Yes, I have heard you have to have an appraisal to get it done, but the $300 (here in SC) for the appraisal would be paid for in a few months of PMI, wouldn't it?
When you find out, let us know as I hope to be there soon and want to know what to do.
The way I understand it is once the balance of your mortgage reaches 80% of the original loan amount, you need to submit a letter to your bank (mortgage co. or whatever)to have it cancelled. If you do not cancel it once you reach 80%, the bank is required to cancel it at I think 78%. As far as I know, you don't need an appraisal for that (the numbers should tell you if you have 20% equity).
When we closed on our loan a year ago, the closing officer told us that another way we can get PMI cancelled is say the price of houses in our area skyrockets- she told us to call a realtor to find out the market value on our house, compared to our loan amount. If we have the 20% equity, call the bank, then they will do an appraisal. If you don't have the 20%- then there's no money lost.
But your best bet is to call your bank's loan dept- or mortgage company and find out what they require for you to cancel it. They probably all do things a little differently.
Congrats on being able to cancel it!! That's a huge savings each month!!
Laura
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