PMI Cancellation Advice

[Jennifer Wood]

I am a first time homeowner. I recently paid down my loan so that I had 80% LTV. As advised by my mortgage company, I sent a written request to cancel PMI and an appraisal was done. According to the report, the current value is significantly higher than the original value. However, I received a denial letter stating that the value of the property had declined. I immediately called the mortgage company and informed them of this discrepancy. They claimed that, because it's a Fannie Mae loan, I don't meeting the seasoning requirements and that I actually need 75% LTV and significant improvements to the home in order to cancel PMI. Isn't this the requirement for cancellation based on the current value, not the requirement for cancellation based on the original value? Not to mention that this reason for denial wasn't even checked off on the denial letter. (This is a conventional, conforming loan.) The customer service reps and supervisor with whom I spoke supposedly put in multiple requests to the escrow department (they have no direct line or email- convenient) to have this resolved. They have not once called me back. They refuse to cancel my PMI or even refund me for the appraisal (which they insisted go through their company). Am I misunderstanding the laws? I've read the Fannie Mae guidelines, HPA guidelines, the state code, and the US code explaining the impact of the HPA on state laws. I just sent a qualified written request demanding that the issue be resolved. Am I taking the right steps? Please help!