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Private Mortgage Insurance (“PMI”) is typically required by mortgage lenders in circumstances where borrowers are unable to make a down payment of 20% or more in connection with a mortgage loan. The charges for PMI are added to the borrower’s monthly mortgage payment, and can be hundreds of dollars per month.
The Homeowners Protection Act is intended to protect borrowers from unnecessary PMI charges. On most home loans, PMI must be canceled at the request of the borrower if the loan-to-value ratio is 80 percent or less and:
For most home loans PMI must be automatically canceled on the date when the borrower’s principal balance is scheduled to reach 78 percent of the original value of the home, if the borrower is current on the payments required by the mortgage.
Nichols Kaster understands how unfair and intimidating it can be to take on a large corporation on your own, and we would like to help. Please contact us if you believe your mortgage lender or servicer has failed to comply with the laws regarding private mortgage insurance.