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Many past clients bought with less than 20% down and are still paying private mortgage insurance (PMI) on a conventional loan. Most of them have no idea when it can come off, or that rising home values may have moved that date closer. A loan officer who brings it up first is handing the client real money, and that is a memorable reason to stay in touch.
Why PMI is a great reason to reach out
PMI removal is one of the few conversations where the borrower wins without taking on a new loan. It shows you are watching out for them after closing, not just when you want to sell something. It also gives you a natural, specific reason to call instead of a generic check-in.
Know the basics before you call
- Requested removal. On many conventional loans, borrowers can ask the servicer to cancel PMI once the balance reaches a set share of the original value, if they meet payment history and other requirements.
- Automatic termination. PMI generally ends on its own at a later loan-to-value point on the original schedule, as long as the loan is current.
- New value. Some servicers will consider a new appraisal if the home has gained value, with their own seasoning and loan-to-value rules.
- FHA is different. FHA mortgage insurance follows its own rules, and for some borrowers refinancing is the only way to remove it.
The servicer and the loan documents set the exact rules, so explain the general idea and point the client to the servicer for their specific numbers.
Track who is getting close
Note the original loan amount, value, and loan type in your CRM for every client with mortgage insurance. Check in around the first and second anniversary, and again when local values have moved. A quick estimate of where they might stand is enough to start the conversation.
Keep the conversation honest
For some clients, the best answer is simply asking the servicer to drop PMI. For others, especially on FHA loans, a refinance or a broader annual mortgage review may make more sense. Run the numbers and only recommend a new loan when it clearly helps them.
Bottom line
Helping a past client get rid of PMI is a simple, generous follow-up that lowers their payment and reminds them who looks out for them. Track who has mortgage insurance, reach out before they think to ask, and send them to the servicer with a clear next step.
RateUpdate keeps your past clients on a branded monthly rate update, so you stay in their inbox between these conversations.