Finance
A borrower with a conventional loan and less than 20% down payment can request cancellation of PMI when:
AThe loan has been paid for 5 years
BThe loan-to-value ratio reaches 80% based on the original purchase price or appraised value✓ Correct
CThe property is refinanced
DThe borrower's credit score exceeds 750
Explanation
Under the Homeowners Protection Act, borrowers may request PMI cancellation when the LTV ratio reaches 80% of the original purchase price or appraised value at origination, based on a good payment history.
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