PMI Automatic Termination
For many covered mortgages, PMI must generally terminate automatically when the principal balance is scheduled to reach 78% of the home's original value (with current-payment conditions), and there is also a "final termination" concept tied to the midpoint of the amortization schedule. These termination mechanics are described in CFPB guidance and in federal banking compliance frameworks.
- Where it applies
- Federal
- When it comes up
- Servicing
- Property types
- Residential (conventional)
In practice
Mortgage products with interest-only periods or balloon features can interact with midpoint termination logic in non-intuitive ways, increasing servicing complexity.
Related terms
Residential Financing
- Accrual Rate
- Adjustable Rate Mortgage (ARM)
- Amortization
- Application (TRID application)
- Conforming Loan Limit
- Pay Rate
- PMI Cancellation (Borrower-Requested)
- Private Mortgage Insurance (PMI)
- Secured Overnight Financing Rate (SOFR)
- TILA-RESPA Integrated Disclosures (TRID)
General information, not legal, tax or financial advice.