Finance
Under the Homeowners Protection Act (Private Mortgage Insurance Cancellation Act), a borrower can request PMI cancellation when:
AThey have made 24 consecutive on-time payments
BThe loan balance reaches 80% of the ORIGINAL value of the property✓ Correct
CThe property appreciates to twice the original purchase price
DPMI has been paid for a total of 5 years
Explanation
The Homeowners Protection Act gives borrowers the right to request PMI cancellation when the loan balance reaches 80% of the original value (purchase price or appraised value, whichever is lower) based on the original amortization schedule. PMI must be automatically terminated when the balance reaches 78%.
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