{"@context":"https:\/\/schema.org\/","@type":"BlogPosting","@id":"https:\/\/www.getloans.com\/blog\/dropping-mortgage-insurance\/#BlogPosting","mainEntityOfPage":"https:\/\/www.getloans.com\/blog\/dropping-mortgage-insurance\/","headline":"Dropping Mortgage Insurance","name":"Dropping Mortgage Insurance","description":"What does dropping mortgage insurance mean? This is different for Conventional loans than FHA loans. FHA loans: you are getting a loan that is insured against loss by the federal government through mortgage insurance, you are not getting a loan directly from the federal government. It is this mortgage insurance that many people do not […]","datePublished":"2010-11-22","dateModified":"2023-11-15","author":{"@type":"Person","@id":"https:\/\/www.getloans.com\/blog\/author\/brianm\/#Person","name":"brianm","url":"https:\/\/www.getloans.com\/blog\/author\/brianm\/","identifier":2,"image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/b03dd1a5c12d48f4023463adfa5dbd6d38ebf6f4d842bd8f8d55ec71cb0ca275?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/b03dd1a5c12d48f4023463adfa5dbd6d38ebf6f4d842bd8f8d55ec71cb0ca275?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Person","name":"Brian Martucci","image":{"@type":"ImageObject","@id":"https:\/\/www.getloans.com\/wp-content\/uploads\/2026\/06\/brianmartucci-getloans-logo2017.webp","url":"https:\/\/www.getloans.com\/wp-content\/uploads\/2026\/06\/brianmartucci-getloans-logo2017.webp","width":400,"height":70}},"image":{"@type":"ImageObject","@id":"https:\/\/www.getloans.com\/wp-content\/uploads\/2010\/11\/delete-button.png","url":"https:\/\/www.getloans.com\/wp-content\/uploads\/2010\/11\/delete-button.png","height":1102,"width":1280},"url":"https:\/\/www.getloans.com\/blog\/dropping-mortgage-insurance\/","about":["FHA"],"wordCount":435,"keywords":["FHA mortgage insurance dropping"],"articleBody":"What does dropping mortgage insurance mean? This is different for Conventional loans than FHA loans. FHA loans: you are getting a loan that is insured against loss by the federal government through mortgage insurance, you are not getting a loan directly from the federal government. It is this mortgage insurance that many people do not know how or when to get rid of.FHA loansFor homeowners with FHA mortgages that pre-date June 2013, FHA mortgage insurance cancels as soon as loan-to-value reaches 78% and 60 months have passed since the loan’s inception. For everyone else after June 2013,\u00a0FHA mortgage insurance for a 3.5% down payment FHA loan lasts for as long as the\u00a0loan exists. You cannot drop or cancel FHA mortgage insurance. To remove FHA mortgage insurance you can try and refinance into a Conventional loan if you have sufficient equity to do so. And you have to make sure the\u00a0new interest rate and any new Conventional mortgage insurance you’d be refinancing into is not a greater penalty than dropping\u00a0the FHA mortgage insurance.Conventional loansOn a Conventional loan it is a lot easier to drop the mortgage insurance. “PMI Drop” rules may vary from lender to lender or from region to region, but in general if you have not been late on the mortgage payment in the past 12 months, and have paid mortgage insurance for at least 2 years, and the bank can get an appraisal done (the homeowner will not be allowed to pick the appraiser) showing a 75% loan-to-value, the mortgage insurance can be dropped. And if you have owned the home for at least 5 years then you would only need an appraisal showing an 80%\u00a0loan-to-value.Agency RulesFannie Mae has rules for dropping mortgage insurance.Read the Consumer Financial Protection Bureau’s take on dropping PMI on Conventional loans here\u00a0and here.And FYI, a high appraisal when you initially purchase\u00a0a home will not help you in canceling the mortgage insurance right away. The rules require you to have paid the mortgage insurance for at least 2 years before you can attempt to drop it.So keep on top of the latest sales of similar homes in your area, and do an analysis after the first 2 years of homeownership, and then every year thereafter, to see how close you may be to dropping your mortgage insurance.It’s my job to help you understand the complexities of your loan now and in the future. To contact me to discuss your local housing market, mortgage rates, or other mortgage questions,\u00a0click here to schedule a call\u00a0or you can\u00a0email me\u00a0directly."}