Question:

When are PMI (private mortgage insurance) payments cancelled?

Answer:

The Homeowner Protection Act of 1998 provides clarification on when PMI (private mortgage insurance) payments are cancelled. It basically sets the rules of PMI payments cancellation for first mortgages and conventional loans. FHA, VA and HUD sponsored programs, as well as second mortgages are exempt of the Act.

PMI (Private Mortgage Insurance) Payments Cancelled Upon Request

Lenders are demanded to inform borrowers of their right to request PMI (private mortgage insurance) payments cancellation if certain conditions are met; and provide address and telephone number to consumers.

Lenders are also required to inform borrowers that automatic cancellation of the PMI payments will occur, and provide information when this is to be expected.

The loan servicer will send notice when PMI (private mortgage insurance) payments have been terminated.

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