Finance
What does 'PMI cancellation' require under the Homeowners Protection Act?
APMI automatically cancels when the property is worth 80% more than the original value
BLenders must cancel PMI automatically when the loan balance reaches 78% of the original purchase price (for loans meeting certain criteria)✓ Correct
CBorrowers may request cancellation after 5 years regardless of LTV
DPMI is a permanent requirement that cannot be cancelled
Explanation
Under the Homeowners Protection Act (HPA), lenders must automatically cancel PMI when the loan balance reaches 78% of the original purchase price for qualifying loans. Borrowers may request cancellation at 80% LTV.
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