Finance
The purpose of the federal Homeowners Protection Act (HPA) is to:
ARequire all lenders to offer FHA loans
BAllow borrowers to cancel PMI when their loan balance reaches 80% of the original property value✓ Correct
CProtect homeowners from foreclosure during economic downturns
DSet maximum interest rates on home equity loans
Explanation
The HPA gives borrowers the right to request cancellation of PMI when their loan balance reaches 80% of the home's original value, and requires automatic PMI termination at 78% LTV. This reduces ongoing costs for borrowers who build equity.
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