President Donald Trump's October 22 housing order aims to lower homeownership costs. Its new private mortgage insurance pilot would cover only mortgages made after the pilot is established. It does not order immediate PMI removal from existing loans.
Current homeowners may already qualify for cancellation under existing rules. The order also contains separate refinance provisions that could help some borrowers. Those are different paths to savings, with different requirements.
What the new PMI pilot could change
The signed executive order calls for a Fannie Mae and Freddie Mac pilot to identify eligible borrowers and cancel PMI proactively. Establishment depends on a determination by the Federal Housing Finance Agency (FHFA) director under the order's conditions. PMI protects the lender against borrower default; it is separate from homeowners insurance.
The pilot would use automated valuation models, meaning computer-generated property estimates, and other data to review loans periodically. Payment history and other eligibility requirements would still apply. The order calls for prompt notices and fewer unnecessary appraisal costs and paperwork, within legal and operational limits. It does not guarantee a free appraisal or cancellation at a universal 80% threshold.
The order specifies no PMI launch date. Its coverage begins with loans made after establishment, not simply after the signing date. The order itself creates no new enforceable borrower right; existing PMI cancellation rights remain separate.
A September change already affects borrower outreach
Fannie Mae's September 16 lender letter permits servicers to contact borrowers who may qualify for current-value PMI termination, effective immediately. Freddie Mac had already permitted similar outreach, including in its 2018 servicing bulletin.
Permission to contact borrowers does not cancel insurance or waive eligibility. You can ask for a review without waiting to hear from the company collecting your mortgage payment.
When checked on October 24, Fannie Mae's online servicing guide still displayed the previous restriction on current-value outreach. The September letter supersedes that restriction and says a guide update will follow.
Why I would watch when the savings arrive
The Consumer Financial Protection Bureau (CFPB) has documented failures under existing rules. Its Fall 2021 report described missed scheduled PMI terminations for borrowers who were current on payments because human error produced inaccurate termination data. Servicers corrected their reports and added quality controls.
The Summer 2021 report described escrow estimates that included a full year of PMI even though servicers knew coverage would end during the year. The report says servicers began using that termination information in their analyses.
Earlier, an August 2015 bulletin documented cancellation delays, unearned premiums and at least one servicer whose vendor kept returned premiums in escrow indefinitely instead of returning them within 45 days.
These are historical supervisory findings. They give us concrete steps to inspect in a new program: accurate reviews, timely notices, correct cancellation dates and updated accounts. They do not establish misconduct under this order.
For a household, timing matters. In a hypothetical case, six extra $150 premiums would tie up $900 until corrected. A later refund restores the money, but it does not erase the temporary cash-flow problem.
How to check whether PMI can come off now
For covered borrower-paid PMI, CFPB guidance describes a written request at the scheduled or actual 80% point using original property value, subject to payment-history, lien and value conditions. Automatic termination generally uses the scheduled 78% point if you are current; a midpoint backstop also exists. A purchase generally uses the lower of its price or appraisal; a refinance generally uses its appraised value.
Current-value rules differ. For an eligible Fannie Mae loan on a one-unit primary home or second home, the ordinary threshold is 75% LTV at two through five years and 80% after five years. Qualifying substantial improvements can waive the two-year minimum at 80%. Payment history and valuation conditions still apply.
Freddie Mac also has current-value cancellation rules. Ask your servicer to identify the investor and applicable requirements. A tax assessment or online estimate alone does not establish eligibility. Our conventional PMI removal guide explains the cancellation paths; how to lower your mortgage payment also covers escrow and recasting.
What cancellation could save
Suppose your statement shows $150 a month in PMI. Avoiding 12 full months of premiums saves $1,800. After a hypothetical $300 valuation fee, net savings would be $1,500, with a two-month payback. If automatic termination is only two months away, that fee could use up the entire benefit.
Use your own premium, quoted fee and remaining coverage period. These figures illustrate existing cancellation options, not promised savings from the new order.
The separate refinance provisions
The order conditionally directs expansion of the title-acceptance program, which allows alternatives to a lender's title insurance policy on eligible refinances. Section 4(c) requires resulting savings to be passed to borrowers and disclosed. Other possible changes, including certain appraisal and income-verification waivers and lower fees, are for consideration.
Title insurance is a closing cost, separate from monthly PMI. Compare the full refinance, including rate, fees, repayment period and cash needed at closing. Removing PMI from an eligible existing conventional loan can avoid replacing that loan.
FHA mortgage insurance follows different rules
For FHA case numbers assigned on or after June 3, 2013, annual MIP generally lasts 11 years at original LTV of 90% or less, and the loan term above 90%. Older loans differ. The PMI pilot does not create a 20%-equity cancellation right for FHA MIP. See HUD's duration table and our FHA versus conventional guide.
A message to send your servicer
Use the secure portal or contact details on your mortgage statement. You can send:
Please review my loan for mortgage insurance cancellation. Identify my loan type and investor, the options based on original and current value, and my scheduled automatic termination date. If a valuation is needed, explain the process and cost before I pay. Please confirm the decision, effective date and new payment in writing. If cancellation is denied, explain the specific reason.
Keep paying the amount due until the servicer confirms a change. If you believe premiums continued improperly, request a written explanation and refund review. Unresolved problems can be raised through the CFPB complaint process.
A second opinion on your numbers
If you own a home in Florida, I can help identify the questions to ask and compare the costs. Contact me to arrange a review. Your servicer handles the cancellation decision under the applicable rules.
Mortgage Expert, Inc., NMLS 2412313. Equal Housing Opportunity. Educational information; your servicer determines cancellation eligibility.