What if you've been 30 days late on payment anywhere in the process? Can you still drop PMI, or will you need to re-finance to do this?

Michael

If your payments have been on time, they will sometimes drop the PMI when you reach 15% equity.  One or two late payments will not always be held against you.  Our mortgage bank was 30 miles away on the other side of the Hudson River.  There were two occasions in which our payments took 2 and 3 weeks to go 30 miles by mail.  Apparently, this was not held against us.   I was surprised when we received the notice of the PMI being dropped at 15% equity because at that time the real estate market had collapsed and our house was worth $30,000 less than we paid for it.  In the end, it all depends on your bank.  Local banks tend to be more flexible and customer friendly than the big banks.

You need 12 months of on time payments plus 20% equity in your home. This obviously depends on the bank but if you have been late, you will most likely need to make 12 more on time payments.