Late payment tarnishes mortgage borrower’s record

PMI not automatically canceled with 20% home equity

Learn the New Luxury Playbook at Luxury Connect | October 18-19 at the Beverly Hills Hotel

DEAR BOB: I was under the impression that when I acquired 20 percent home equity, my PMI (private mortgage insurance) premium would be automatically cancelled. When I contacted my mortgage company recently, they told me I cannot cancel PMI unless I have at least 24 months of on-time mortgage payments. I mistakenly forgot to make my payment one month, paid the late fee, and have been on-time every month except that one time. How can I force my mean, nasty, hostile mortgage company to cancel my PMI? – Nate K. DEAR NATE: The only time PMI premiums are automatically canceled occurs when you pay down the original mortgage balance by 20 percent. That usually occurs in about the 10th year of most home mortgages. Purchase Bob Bruss reports online. However, many mortgage lenders will cancel PMI premiums if the mortgage is at least 24 months old, the borrower has a perfect on-time payment record, and there is at least 20 percent home equity as shown by a new appraisal paid for by the bo...