# Mortgage and PMI **URL:** \ **Category:** Factual Questions\ **Created:** [March 2, 2015, 9:41pm UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047 "2015-03-02T21:41:13Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![Mrdeals](https://avatars.discourse-cdn.com/v4/letter/m/ea666f/32.png) [@Mrdeals](https://boards.straightdope.com/u/Mrdeals)\ **Post date:** [March 2, 2015, 9:41pm UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/1 "2015-03-02T21:41:13Z")
I remember my bank saying PMI on my mortgage would come off as soon as I have 20% of the starting principal paid off. I’m currently at about 19.5% and curious if the PMI will automatically come off my payments? Will my monthly payment be changed (being it was escrowed in)? ---
**Author:** ![Duckster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/duckster/32/1244_2.png) [@Duckster](https://boards.straightdope.com/u/Duckster)\ **Post date:** [March 2, 2015, 9:44pm UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/2 "2015-03-02T21:44:56Z")
Your bank has a monetary incentive to not remove PMI, unless you call them on it. Tell your bank to remove it, and get it in writing. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [March 2, 2015, 9:50pm UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/3 "2015-03-02T21:50:43Z")
PMI usually comes off when the remaining principal is 80% or less of the home’s _value_, rather than when 80% of the principal is paid off. Depends on the lender, though. You may have to get an appraisal before the lender will stop requiring PMI. ---
**Author:** ![LSLGuy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lslguy/32/5813_2.png) [@LSLGuy](https://boards.straightdope.com/u/LSLGuy)\ **Post date:** [March 2, 2015, 11:43pm UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/4 "2015-03-02T23:43:31Z")
> [@Mrdeals](#): > > … Will my monthly payment be changed (being it was escrowed in)? When the PMI comes off the payment \*will \*change. As others have said, whether the PMI comes off automatically or you need to move Heaven and Earth to get it stopped depends on your lender and the terms of the contract you signed. You could try reading it to see what it says. ---
**Author:** ![lance\_strongarm](https://avatars.discourse-cdn.com/v4/letter/l/87869e/32.png) [@lance\_strongarm](https://boards.straightdope.com/u/lance_strongarm)\ **Post date:** [March 2, 2015, 11:46pm UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/5 "2015-03-02T23:46:05Z")
> [@Mrdeals](#): > > I remember my bank saying PMI on my mortgage would come off as soon as I have 20% of the starting principal paid off. > > I’m currently at about 19.5% and curious if the PMI will automatically come off my payments? > > Will my monthly payment be changed (being it was escrowed in)? As already noted, it’s not at 20% of the principal necessarily, it’s when you only owe 80% or less on the value of the house. So as your value goes up, you could get off PMI earlier. If you’re home is appreciating at all, you should probably be off PMI by now. I would check now and see if you can get off. I also wouldn’t trust the bank to do it automatically either. ---
**Author:** ![robert\_columbia](https://avatars.discourse-cdn.com/v4/letter/r/e79b87/32.png) [@robert\_columbia](https://boards.straightdope.com/u/robert_columbia)\ **Post date:** [March 3, 2015, 12:04am UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/6 "2015-03-03T00:04:42Z")
What happens if you just stop paying PMI premiums? Would they cancel you for nonpayment? ---
**Author:** ![lance\_strongarm](https://avatars.discourse-cdn.com/v4/letter/l/87869e/32.png) [@lance\_strongarm](https://boards.straightdope.com/u/lance_strongarm)\ **Post date:** [March 3, 2015, 12:10am UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/7 "2015-03-03T00:10:07Z")
> [@robert\_columbia](#): > > What happens if you just stop paying PMI premiums? Would they cancel you for nonpayment? Yes, and then you’d probably be in violation of your mortgage agreement and… It should be easy to get off the PMI by going through the channels. ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [March 3, 2015, 12:14am UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/8 "2015-03-03T00:14:50Z")
Sometimes you need to pay to have the house reassessed. ---
**Author:** ![lance\_strongarm](https://avatars.discourse-cdn.com/v4/letter/l/87869e/32.png) [@lance\_strongarm](https://boards.straightdope.com/u/lance_strongarm)\ **Post date:** [March 3, 2015, 12:17am UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/9 "2015-03-03T00:17:28Z")
> [@Ruken](#): > > Sometimes you need to pay to have the house reassessed. Good point. (Though you mean appraised - assessment is what the government does to decide how much tax you owe). ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [March 3, 2015, 12:50am UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/10 "2015-03-03T00:50:25Z")
> [@lance\_strongarm](#): > > Good point. (Though you mean appraised - assessment is what the government does to decide how much tax you owe). Absolutely. OP should listen to the guy with the big arm. ---
**Author:** ![lance\_strongarm](https://avatars.discourse-cdn.com/v4/letter/l/87869e/32.png) [@lance\_strongarm](https://boards.straightdope.com/u/lance_strongarm)\ **Post date:** [March 3, 2015, 12:51am UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/11 "2015-03-03T00:51:59Z")
> [@Ruken](#): > > Absolutely. OP should listen to the guy with the big arm. It’s a HUGE arm. Not that I used an performance enhancing drugs to get it that way. Not at all. ---
**Author:** ![pkbites](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/pkbites/32/204_2.png) [@pkbites](https://boards.straightdope.com/u/pkbites)\ **Post date:** [March 3, 2015, 1:17am UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/12 "2015-03-03T01:17:06Z")
Every mortgage I’ve had the PMI only came off when I requested it, not automatically. Also, the percentage was calculated by the value that was on the original note, not current appraisal. Certainly YMMV depending on your lender and the terms of your mortgage. ---
**Author:** ![LSLGuy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lslguy/32/5813_2.png) [@LSLGuy](https://boards.straightdope.com/u/LSLGuy)\ **Post date:** [March 3, 2015, 1:20am UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/13 "2015-03-03T01:20:31Z")
> [@lance\_strongarm](#): > > It’s a HUGE arm. Not that I used an performance enhancing drugs to get it that way. Not at all. Is it just one arm? Do you look sorta like a human fiddler crab? ---
**Author:** ![lance\_strongarm](https://avatars.discourse-cdn.com/v4/letter/l/87869e/32.png) [@lance\_strongarm](https://boards.straightdope.com/u/lance_strongarm)\ **Post date:** [March 3, 2015, 2:12am UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/14 "2015-03-03T02:12:41Z")
> [@LSLGuy](#): > > Is it just one arm? Do you look sorta like a human fiddler crab? Pretty much. It has nothing to do with masturbating alot, and everyone needs to stop asking me that. ---
**Author:** ![Waterman](https://avatars.discourse-cdn.com/v4/letter/w/b2d939/32.png) [@Waterman](https://boards.straightdope.com/u/Waterman)\ **Post date:** [March 3, 2015, 5:53am UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/15 "2015-03-03T05:53:28Z")
> [@lance\_strongarm](#): > > As already noted, it’s not at 20% of the principal necessarily, it’s when you only owe 80% or less on the value of the house. **So as your value goes up, you could get off PMI earlier**. If you’re home is appreciating at all, you should probably be off PMI by now. > > I would check now and see if you can get off. I also wouldn’t trust the bank to do it automatically either. Irrespective of original value versus current value, I’ve reread this several times now and don’t you have this ass backwards (bolding mine)? ---
**Author:** ![Waterman](https://avatars.discourse-cdn.com/v4/letter/w/b2d939/32.png) [@Waterman](https://boards.straightdope.com/u/Waterman)\ **Post date:** [March 3, 2015, 6:04am UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/16 "2015-03-03T06:04:27Z")
> [@Waterman](#): > > Irrespective of original value versus current value, I’ve reread this several times now and don’t you have this ass backwards (bolding mine)? Disregard the above:smack: ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [March 3, 2015, 1:57pm UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/17 "2015-03-03T13:57:28Z")
> [@robert\_columbia](#): > > What happens if you just stop paying PMI premiums? Would they cancel you for nonpayment? You would have breached the loan contract and possibly entitled the lender to foreclose immediately (depending on the terms.) More likely, your breach would entitle the lender to pay the premiums itself and add it to the mortgage (with a hefty penalty.) ---
**Author:** ![muldoonthief](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/muldoonthief/32/3188_2.png) [@muldoonthief](https://boards.straightdope.com/u/muldoonthief)\ **Post date:** [March 3, 2015, 2:23pm UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/18 "2015-03-03T14:23:02Z")
> [@robert\_columbia](#): > > What happens if you just stop paying PMI premiums? Would they cancel you for nonpayment? > [@Really\_Not\_All\_That\_Bright](#): > > You would have breached the loan contract and possibly entitled the lender to foreclose immediately (depending on the terms.) More likely, your breach would entitle the lender to pay the premiums itself and add it to the mortgage (with a hefty penalty.) IME, which I’m not claiming to be universal, the PMI was always part of the monthly payment to the bank, along with the tax escrow payment. And the mortgage agreement I signed explicitly stated how they’d allocate the funds if my payment was below the billed amount - first they’d fund the PMI, then the escrow, then the principal & interest. So if you tried to subract the PMI from your monthly payment, you’d actually wind up in arrears on your mortgage itself, and eventually get foreclosed on. ---
**Author:** ![M.Constant](https://avatars.discourse-cdn.com/v4/letter/m/3ab097/32.png) [@M.Constant](https://boards.straightdope.com/u/M.Constant)\ **Post date:** [March 3, 2015, 2:34pm UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/19 "2015-03-03T14:34:28Z")
I went through this a couple of years ago. In my case, the PMI would automatically drop once the current balance to original note hit a certain percentage (~ 79%) \OR\ you could ask them to remove it once the current balance to current value hit a certain percentage (~ 80%). We put some cash down against the principal and had the house reappraised then asked them to review. The process was pretty painless. It saves over $200 a month. ---
**Author:** ![Precambrianmollusc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/precambrianmollusc/32/63_2.png) [@Precambrianmollusc](https://boards.straightdope.com/u/Precambrianmollusc)\ **Post date:** [March 3, 2015, 3:02pm UTC](https://boards.straightdope.com/t/mortgage-and-pmi/714047/20 "2015-03-03T15:02:59Z")
We are dealing with this right now. When the house drops under 80% of the original Loan to Value , you can ask for PMI to be removed. You have to pay for the house to be reappraised ( the bank gets to determine who does the reappraisal) if you balance is less than 80% of the new house value, PMI is off. Also when the balance is scheduled to hit 78% of the original LTV ( or 75% in New York according to the letter from the bank) PMI will be automatically cancelled. That is ‘scheduled’ not when it actually does. My sorry tale Last year we paid down enough to put the house a whisker under 80% of the original Loan To Value. We then had to pay to have the house reassessed, and oddly, in a market where the house prices had all gone up , ours had gone down ( and later I noted and the sq footage of the house in the appraisal had shrunk from the original appraisal, which I thought was odd because nothing has fallen off the house and we put 50K into improvements) This year we pushed it under 78% and asked for the automatic cancellation, to be told, no no no , it is scheduled to hit 78% in June next year, so the extra payments don’t count. We have to go and do the reappraisal again, I am not sure I really want my house to shrink again. [Next page](https://boards.straightdope.com/t/mortgage-and-pmi/714047.md?page=2)