The Homeowners Protection Act gives you the right to cancel private mortgage insurance (PMI) when you reach 80% LTV. Learn PMI cancellation rights, FHA MIP rules, and how improper mortgage insurance charges create foreclosure defenses.
Rush response within 24 hours
Rush response within 24 hours
78%
LTV triggers automatic PMI termination
80%
LTV allows borrower-requested cancellation
0
PMI should remain after automatic termination
30 days
To respond after termination must be noted
The Homeowners Protection Act (HPA) of 1998 protects borrowers who pay Private Mortgage Insurance (PMI) on loans originated after July 29, 1999. When your loan-to-value (LTV) ratio hits certain milestones, the law says your PMI must come off — and servicers cannot simply keep charging it.
No action needed from you.
PMI must automatically terminate when the principal balance reaches 78% of the original value, based on the amortization schedule — meaning the loan's mid-point. The servicer must stop charging PMI no later than the first day of the month after that date.
You must submit a written request.
You can request cancellation once your LTV reaches 80% based on your original purchase price or appraised value. You may need to show you're current, have a good payment history, and provide proof of property value.
Annual Disclosure Requirement
Servicers are required to send an annual PMI disclosure statement that explains your right to cancel and tells you when automatic termination should occur. Failing to send these notices is itself a violation of the HPA.
Charging PMI after the automatic 78% LTV termination date is reached — the most common HPA violation.
Refusing a valid borrower-requested cancellation at 80% LTV despite the borrower meeting eligibility requirements.
Requiring a new appraisal when the loan-to-value is already clear, or charging excessive fees to cancel.
Failing to provide the required annual PMI disclosure statements explaining cancellation rights and timing.
Why It Matters
PMI overcharges silently inflate your loan balance. Every month of improper PMI adds to the principal owed — inflating the payoff amount and distorting the figures in a foreclosure dispute. Correcting it reduces what you owe.
The HPA's automatic termination rules apply to conventional PMI. FHA loans are different — and that difference trips up many homeowners.
Important: If you're unsure whether your loan carries conventional PMI or FHA MIP, check your closing documents or annual escrow statement. The distinction determines which cancellation rights apply — and an attorney can review whether improper charges were made.
Collect your note, mortgage, payment history, escrow statements, and annual PMI disclosures. Calculate what your LTV should have been and when termination should have occurred.
File a written Notice of Error under Regulation X (RESPA) directly identifying the improper PMI charge. This forces the servicer to investigate and respond within the statutory timeframe, and it preserves your claim. See: RESPA Guide.
If the servicer refuses to correct the error or fails to respond, that failure itself creates additional liability and strengthens your case for damages.
HPA violations carry a private right of action. You can pursue the servicer for actual damages plus statutory damages for continued violations, along with attorney fees.
Recover every dollar of PMI improperly charged after the cancellation or termination date.
HPA provides statutory damages for ongoing violations, separate from actual loss.
Fee-shifting provisions can require the servicer to pay your legal fees when you prevail.
Removal of improper charges from your loan balance, correcting your payoff and monthly payment.
HPA violations are actionable. We demand PMI cancellation and refunds of overcharges.