If you bought your home with less a than 20% down payment, you can assume that you are currently paying for PMI (private mortgage insurance).  PMI was introduced over 30 years ago to provide lenders with insurance against default for purchasers with a down payment of less than 20 percent. You are charged an additional premium for this insurance.  This additional premium is being paid by you with every payment to insure the lender in case you default on your loan. If you can prove to the lender that you now have 20% or more equity in your home, the PMI can be removed from your payment. Typical savings are between $30-$150 a month, depending on your original loan amount.

If your current loan is three years old or more, if you purchased below market, or if you have made recent improvements that increase the value of your home, you may now have enough equity to have the PMI removed!

To remove PMI you must contact your lender.  Your lender will normally ask for a summary appraisal report done on a Uniform Residential Appraisal Report (URAR) done by a certified real estate appraiser.  A summary appraisal will include all necessary additional forms and exhibits. 

If you have a condominium, your lender will ask for a summary appraisal report done on an Individual Condominium Appraisal Report form. 

If you have a multi-family dwelling, you will need a summary appraisal report done on a Small Residential Income Property Appraisal form.

Historically you were not told about this insurance and continued to pay it even after your loan was paid down below the 80% of value level!  Recently new laws were passed to protect your interest. As a homeowner, once your equity level in your home reaches 20 percent you have the right to have the PMI Insurance eliminated.