Ending PMI while in Ch 13?

[SMS65]

We have 22 months left on our plan. Our mortgage balance just fell below 78% LTV, based on the statement from the mortgage company.
Will PMI be cancelled because we've fallen below 78% LTV? Or does the Ch 13 negate that rule?
Thanks!

[justbroke]

Welcome to BKForum!

You're going to hate my short answer, but the answer is: it depends on the type of first mortgage that you have.

If it's an FHA loan, the PMI may never end. Under the FHA program, the life of the PMI is based on the loan-to-value (LTV) of the initial loan. If you had an FHA loan with an initial balance of less-than 90% of the property value (sale price or appraised price, whichever is lower), then the PMI will last 11 years. Otherwise, for all other LTVs greater than 90%, the PMI is lifetime of loan. (There are some nuances for refinances.)

If it's a Conventional loan, such as Fannie Mae (FNMA) or Freddie Mac (FHLMC), then the PMI can be removed after the balance of the loan drops below 78% of the initial balance. In fact, this should happen automatically by your lender or servicer. You should call your lender/servicer if your balance is less than 78% of the principal amount of the mortgage (the original balance).

Otherwise you would need to refinance.

(Note: I looked at this extensively while recently shopping mortgages. I believe this information is up to date as of April 2022.)

[Clay3007]

My fha loan with us bank was cancelled at 78% no questions asked. They actually cancelled it not me and im only 36 months in to my plan right now. So

[justbroke]

My fha loan with us bank was cancelled at 78% no questions asked. They actually cancelled it not me and im only 36 months in to my plan right now. So

Did you put down more than 10%, or if you refinanced into an FHA was the LTV less than 90%? It also matters when you originally obtained the FHA loan. If it was after June 2013, then the new rules apply. (If the loan was issued before June 2013, then the old rules apply and you could be eligible for automatic removal after just 5 years.)

[womanonfire]

Look at the Homeowner's Protection Act of 1998. The very best thing to do to address this first is to send a qualified written request/Request for information under RESPA. If you look at your mortgage statement, they will tell you where to send it. It's important to send it to the right address and to send it by some method that allows for proof that you sent it and they received it. https://www.consumerfinance.gov/comp...on-procedures/

[Clay3007]

Did you put down more than 10%, or if you refinanced into an FHA was the LTV less than 90%? It also matters when you originally obtained the FHA loan. If it was after June 2013, then the new rules apply. (If the loan was issued before June 2013, then the old rules apply and you could be eligible for automatic removal after just 5 years.)

my loan was takin out in march of 2013 so I’m under the old rules.

[justbroke]

my loan was takin out in march of 2013 so I’m under the old rules.

You are so lucky! I think it should be automatic, but you may need to poke your lender/servicer.