PMI removal // Seeking advice

[Steven Breckon]

Hello everyone!
I'm hoping to get some help as I've been going in circles with my loan servicer (Freedom Mortgage) regarding the steps to remove PMI before two year seasoning.


What has happened so far:
-I purchased the home April 2021 with 13% down on a conventional Fannie Mae mortgage. Primary residence.
-The loan servicer initially denied our request for PMI removal because they said our mortgage had not been seasoned for two years, and our LTV was not yet at 80%
-I explained that we first needed to order an appraisal in order for them to have accurate LTV numbers due to a top to bottom kitchen renovation which should also waive the Fannie minimum two-year seasoning requirement.
-Finally today, after going through 3 customer service reps - I've finally been able to submit a request for appraisal and if there are no snags, once this info is in their system I will re-submit request for PMI removal.


What I'm hoping to understand better:
The part of the rules that I'm lacking clarity on is that the section of B-8.1-04: Termination of Conventional Mortgage Insurance which describes the exception to the two year seasoning requirement is under the heading "Borrower-Initiated Termination of Conventional Mortgage Insurance Based on Current Value of the Property".

Once appraisal is completed and LTV updated in the servicer's system, should I be requesting in writing that PMI be canceled based off of CURRENT VALUE or ORIGINAL VALUE?

If I am requesting PMI be removed based on CURRENT VALUE (because we have held the mortgage for less than two years and using the improvements exception) -- does this mean that the appraisal amount that applies to this specific LTV calculation for PMI removal must be based solely on the value of the improvements? Or will the increased market value contribute as well?


Some numbers:
Purchase price / 2021 appraisal: $945,000
Initial Loan Amount: $822,375
Current outstanding balance: $803,720
Estimated kitchen renovation value: $40,000-$60,000
Redfin/Zillow/ market value estimate (averaged): $1,150,553




Thanks in advance! Really appreciate any advice/anecdotes anyone is wiling to share. This is my first rodeo.

[Caroline Gerardo]

what you should do:

1. print the fannie mae lookup https://www.knowyouroptions.co.

2. Ask servicer who is trustee of note and their email and usps address

3. Get a realtor to give you a free BPO in writing with three comparables in past three months within blocks

4. use the servicer's form to request cancellation of mortgage insurance or if they don't have one write a letter with loan number, your full contact info, the last bill 

5. Estimate in a cost breakdown your improvements and provide any receipts

All the above is mailed, emailed, faxed to servicer and trustee, keep the email copies.

Zillow/Redfin value is meaningless and not useful, just an AVM. 

Wait a week and start calling them. Keep a record of who you speak to each time. It is current value.  Happy money saving!!!