Automatic Termination Guidelines for Single Family Principal/Second Home
Mortgages Closed On or After 7/29/99
Automatic termination: The earlier of (1) the date the mortgage balance is first scheduled to reach 78 percent of the original value; or (2) the mid-point of the amortization period.
Effective date: 7/29/1999
Mortgages Closed Before 7/29/99
Automatic termination: Mid-point of the amortization period
Effective date: 1/02/2001.
Borrower-Initiated Cancellation Guidelines for Single Family Principal/Second Home
Cancellation Evaluation Based on Original Value
Mortgages Closed On or After 7/29/99
Cancellation point: Loan-to-value ratio must be 80 percent or less
Effective: 7/29/99.
Cancellation Evaluation Based on Original Value
Mortgages Closed Before 7/29/99
Cancellation point: Loan-to-value ratio must be 80 percent or less
Effective: 5/07/99.
Mortgage insurance cancellation must be approved at the above cancellation points provided the following criteria are satisfied:
- Payment Status: No 30 day late payments in the 12 months prior to the cancellation date/point, and no 60 day late payments in the 24 months prior to cancellation date and cancellation point.
- Evidence of Value: Appraisal to support loan-to-value requirements at borrower’s expense.
No minimum length of time from date loan was closed.
Cancellation Evaluation Based on Current Value
Mortgages Closed Before, On or After 7/29/99
Cancellation Date: Loan-to-Value ratio must be 80 percent or less if 5 years or more have elapsed since loan origination; or Loan-to-Value ratio must be 75 percent or less if 2 or more years, but less than 5 years, have elapsed since origination.
Minimum seasoning requirements: 2 years for 75 percent LTV cancellation, 5 years for 80 percent LTV cancellation.
Effective date: 5/7/99 or 7/29/99 Mortgage insurance cancellation must be approved at the above cancellation points provided the following criteria are satisfied:
- Payment Status: No 30 day late payments in the 12 months prior to the cancellation date/point, and no 60 day late payments in the 24 months prior to cancellation date and cancellation point.
- Current Appraisal (at borrower expense)
Minimum seasoning requirement does not apply if the increase in value is due to property improvements made after loan origination
