How to Remove PMI on a Conventional Loan in Texas

Conventional Loan

How to Remove PMI on a Conventional Loan in Texas

Reviewed by the HomeMath editorial team Updated 2026-08-06

Key takeaways

Lender must automatically cancel PMI when the loan reaches 78% LTV (about 22% equity) under the Homeowners Protection Act.
You can request PMI removal once you reach 80% LTV (about 20% equity) if you have a good payment history.
Providing a new appraisal or making extra principal payments can speed up PMI cancellation.

Private Mortgage Insurance (PMI) protects the lender when a conventional loan is funded with less than 20% equity. In Texas, as elsewhere, the Homeowners Protection Act (HPA) sets the federal rules for when PMI must be cancelled.

When PMI Can Be Removed

Automatic cancellation: The lender must automatically terminate PMI when the loan balance reaches 78% of the original property value, provided you are current on payments.
Borrower‑initiated cancellation: You may ask the lender to stop PMI once the balance falls to 80% LTV, but you must have a good payment history (typically no late payments in the past 12 months).

Steps to Request Cancellation

Confirm your loan’s current LTV by checking your latest mortgage statement or using an online amortization calculator.
Gather supporting documents, such as recent pay stubs, tax returns, and proof of on‑time payments.
Submit a written request to your lender. Include a statement that you have reached the 80% LTV threshold and ask if a new appraisal is required.
If the lender asks for an appraisal, arrange one through a qualified appraiser. In Texas, both spouses’ equity counts toward LTV because the state is community‑property.
Pay any applicable appraisal fee, then await the lender’s written confirmation that PMI has been cancelled.

Texas‑Specific Considerations

Texas is a community‑property state, so equity owned by both spouses is combined when calculating LTV. Additionally, many Texas closings involve attorneys or title companies, which can assist in obtaining the necessary appraisal documentation.

This article provides general information and is not personalized financial advice. Consult your lender or a qualified professional for guidance specific to your situation.

FAQ

Can I refinance my loan to get rid of PMI?

Yes, refinancing into a new loan with at least 20% equity can eliminate PMI, but you should compare the costs of refinancing (closing fees, interest rate) against the monthly savings from removing PMI.

Do I have to pay a fee for a new appraisal in Texas?

If the lender requires a new appraisal to verify the 80% LTV, you will typically cover the appraisal cost. The fee varies by appraiser and region, but it is a one‑time expense.

How long does the PMI cancellation process take after I submit a request?

After you submit a written request and any required appraisal, lenders usually have 30 days to respond. Once approved, the PMI should be removed from your next billing cycle.

Are there any Texas state programs that help with PMI removal?

Texas does not have a specific state program for PMI removal, but first‑time‑buyer assistance programs may help you reach the 20% equity threshold faster through down‑payment grants or low‑interest loans.

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