While lending institutions have been legally required (for loans closed after July 1999) to cancel Private Mortgage Insurance (PMI) at the time the balance goes below 78% of the price of purchase, they do not have to cancel automatically if the loan's equity is above 22%. (Some "higher risk" morgages are excluded.) However, if your equity reaches 20% (no matter what the original purchase price was), you can cancel PMI (for a mortgage loan that past July 1999).
Keep a running total of your principal payments. Find out the purchase prices of other houses in your neighborhood. Unfortunately, if you have a new mortgage - five years or fewer, you probably haven't been able to pay very much of the principal: you have been paying mostly interest.
As soon as your equity has reached the required twenty percent, you are not far away from stopping your PMI payments, once and for all. Contact the lending institution to ask for cancellation of your PMI. Lending institutions ask for documentation verifying your eligibility at this point. You can get proof of your equity by getting a state certified appraisal using form URAR-1004 (Uniform Residential Appraisal Report), which is required by most lending institutions before canceling PMI.
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