How Do I Get Rid of PMI?
- By Jim Blackburn
- on
- 100 first time home buyer FAQs
1. Build 20% Equity in Your Home
The key to canceling PMI is hitting that magic number: 20% equity. That means your remaining loan balance is 80% or less of your home’s current value.
There are two main ways to build equity:
- Regular monthly payments (which chip away at your principal)
- Making extra payments (even one extra payment a year can help!)
You can also gain equity faster if home values in your area go up—which leads to the next step.
Want to track your home’s value and equity growth? Get a Free Home Evaluation to see if appreciation has pushed you closer to the 20% equity threshold needed to cancel PMI.
2. Request Cancellation—Don’t Wait for It to Happen Automatically
Once you reach 20% equity, contact your lender and formally request PMI cancellation. You may need:
A new home appraisal to confirm the current value Proof of a solid payment history A written request to remove PMISome lenders won’t cancel it automatically until you reach 22% equity, so being proactive could save you hundreds—or thousands—sooner.
Understanding exactly how PMI affects your monthly payment helps you see the savings. Calculate your Conventional Purchase Loan Payment now to compare scenarios with and without PMI and see how much you’ll save once it’s removed.
3. Consider Refinancing to Speed Things Up
If your home’s value has significantly increased, refinancing into a new mortgage can help:
- Lock in a lower interest rate (if market conditions allow)
- Recalculate your equity based on your home’s new value
- Remove PMI if your new loan-to-value (LTV) is under 80%
Refinancing also gives you a chance to restructure your loan with better terms—and potentially save big over time.
Ready to explore refinancing to eliminate PMI? Calculate your Conventional Refinance Rate Reduction Loan Payment now to see if refinancing based on your home’s current value gets you past 80% LTV and removes PMI while potentially lowering your rate.
Want to see the complete cost comparison? Calculate your Compare 2 Rates (Interest Costs) now to compare your current mortgage with PMI against a refinanced loan without PMI and understand total long-term savings.
Ready to Drop That Extra Monthly Payment? Let’s Make It Happen
At Stairway Mortgage, we help you build wealth step by step—and that includes knowing when to stop paying for what you no longer need.
📘 Download our homebuyer guides about removing PMI.
🏠 Get a Free Home Evaluation to track your equity.
📊 Check Current Rates for refinancing options.
🧮 Explore refinancing with our Conventional Refinance Calculator.
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