At what point should a homeowner contact the mortgage company to request that PMI be stopped?

A homeowner should contact the mortgage company to request that Private Mortgage Insurance (PMI) is stopped when their equity in the house reaches 20%. This is important because reaching 20% equity indicates that the homeowner has paid down enough of their mortgage principal that the lender may no longer require insurance to protect against the risk of default. PMI is designed to protect lenders when borrowers put down less than 20%, so once the equity threshold is met, the homeowner can seek to eliminate this additional cost from their monthly mortgage payment.

While refinancing can also impact PMI, simply refinancing does not automatically stop PMI coverage; the homeowner must still meet the equity requirements after the refinance. Additionally, reaching 10% equity may not be sufficient for PMI cancellation, and waiting until the mortgage is fully paid off would be unnecessary since PMI can be canceled well before that point, at the 20% equity mark.