Your Home’s Rising Value Could Help Lower Your Mortgage Payment 

By TW Shortt, CRS™, CRB™ 
Broker/Manager, REALTY WORLD® Knox Realty Group and Flat Fee Connect, LLC 

If you bought your home with a small down payment, you may have been paying private mortgage insurance, commonly called PMI, as part of your monthly mortgage payment. 

A recent change from Fannie Mae could make it easier for some homeowners to find out whether they may now qualify to have that mortgage insurance removed. 

On September 16, 2026, Fannie Mae announced that mortgage servicers may proactively contact borrowers whose loans may be approaching the requirements for mortgage-insurance termination based on the current value of the home. 

This could matter for homeowners whose properties have increased in value since they purchased them. 

Your Equity May Have Grown 

Consider a homeowner who purchased a house several years ago with less than 20 percent down. 

At the time, mortgage insurance may have been required because the homeowner had little equity in the property. 

Since then, two things have happened. The homeowner has been making monthly mortgage payments and reducing the loan balance, while the home’s market value may also have increased. 

Together, those changes can increase the homeowner’s equity. 

This is especially relevant locally because, over the years, many customers of REALTY WORLD® Knox Realty Group have purchased homes using financing that included mortgage insurance. Some of those homeowners may now have enough equity to justify asking their mortgage servicer for a review. 

Why This Matters 

Mortgage insurance protects the lender, not the homeowner. 

If it is no longer required, eliminating that monthly expense could reduce a homeowner’s housing cost without requiring the homeowner to sell the property or refinance the mortgage. 

That can be especially important for homeowners who currently have a favorable interest rate and do not want to give it up by refinancing. 

It Is Not Automatic 

A home’s value increase does not automatically eliminate PMI. 

Eligibility can depend on the type of mortgage, the remaining loan balance, the property’s current value, payment history, and how long the loan has been in place. 

The mortgage servicer may also require an appraisal or another approved property valuation before determining whether mortgage insurance can be removed. 

FHA loans have different mortgage insurance rules, so homeowners should first determine what type of mortgage they have. 

What Should You Do? 

If mortgage insurance appears on your monthly mortgage statement, contact your mortgage servicer and ask: 

“Am I eligible to have my mortgage insurance removed based on the current value of my home?” 

And if you purchased your home through REALTY WORLD® Knox Realty Group and have questions about whether this may apply to you, give us a call. We will be glad to help you review the basic information, understand your current equity position, and determine whether it makes sense to contact your mortgage servicer for a formal review. 

The mortgage servicer makes the final decision, but we can help you know what questions to ask. 

We usually think about rising property values when it is time to sell. But appreciation can have benefits long before a homeowner puts a house on the market. 

For some homeowners, one telephone call could lead to a lower monthly payment. 

Source: Fannie Mae, Lender Letter LL-2026-07, Updates to Mortgage Insurance Termination Requirements, September 16, 2026.