On this page
An executive order signed October 22, 2026 opens the door to a PMI cancellation pilot at Fannie Mae and Freddie Mac. The pilot would use automated home valuations to find borrowers with enough equity and cancel their mortgage insurance. However, it starts only if the Director of the Federal Housing Finance Agency (FHFA) approves it, and only for loans made after launch. As of November 9, 2026, the order has not changed the rules for borrowers who pay PMI today.
What the order says about PMI cancellation
Section 2 of Executive Order 14438, “Decreasing Housing Costs for the American People,” covers mortgage insurance. The FHFA Director “shall, if he determines” the pilot serves Fannie Mae, Freddie Mac or FHFA and the public, direct the two companies to create it.
If the pilot goes ahead, the text calls for:
- Loans covered: single-family loans Fannie or Freddie own, guarantee or securitize, “applicable only to mortgages made after the establishment of the pilot program.”
- Method: periodic checks of current value with automated valuation models (AVMs), software that estimates value from sales and property data.
- Trigger: PMI ends when Fannie or Freddie finds the borrower meets equity, payment-history and other requirements.
- Servicers: prompt notice to borrowers, with fewer documentation requests and appraisal costs where law and operations allow.
Section 2 sets no deadline. Section 6(c) also says the order creates no right a borrower can enforce.
How PMI cancellation works today
The Homeowners Protection Act (12 U.S.C. 4901 and 4902) already sets two paths. As the CFPB explains, they apply to borrower-paid PMI on single-family principal residences with loans that closed on or after July 29, 1999:
- By request: ask in writing once your balance reaches 80% of the home’s original value. You need a good payment history, no second lien and proof the value has not dropped.
- Automatically: the servicer must end PMI when the balance is scheduled to hit 78% of original value, if you are current.
Fannie Mae and Freddie Mac also allow removal based on today’s value. Under Fannie Mae Servicing Guide B-8.1-04 and Freddie Mac Guide Section 8203.2, the rule for a one-unit home you live in is this. The loan-to-value ratio (LTV) must be 75% or less for a loan 2 to 5 years old. After 5 years, the limit is 80%. Other property types have stricter limits. A broker price opinion or an appraisal sets the value.
Say you bought a $400,000 home three years ago with a $360,000 loan, and you now owe $340,000. That balance is 85% of original value, too high for an 80% request. But if a new valuation comes in at $460,000, your LTV is about 73.9%, under the 75% limit.
Today, the borrower must still make the request. Since a September 16, 2026 Fannie Mae lender letter, servicers at both companies may contact borrowers who look close to eligible. The pilot would go further: Fannie and Freddie would find eligible borrowers and cancel the insurance themselves.
FHA mortgage insurance premiums (MIP) follow separate HUD rules, which the order does not mention. Our FHA MIP chart covers them.
Who could get PMI cancellation under the pilot
If approved, the pilot would reach conventional loans with mortgage insurance that Fannie or Freddie own, guarantee or securitize, made after launch. It would not cover existing loans, even ones Fannie or Freddie already hold. Nor does the order reach FHA, VA or USDA loans, or loans held in portfolio or sold to private investors.
The order sets no equity level, seasoning period or payment rule. Fannie and Freddie would write those under Section 2(b).
What to do now
- If you have PMI today, compare your balance with 80% of your original value. Once you reach it, send your servicer a written request. See how to remove PMI on a conventional loan for the steps.
- If your home value has risen and the loan is at least two years old, ask your servicer about current-value removal. Ask what the valuation costs first.
- Check who owns your loan with Fannie Mae’s loan lookup tool or Freddie Mac’s loan look-up tool.
- If you are buying with less than 20% down, budget for PMI under today’s rules, because the pilot does not exist yet. This breakdown of PMI costs can help you estimate it.
Other parts of the order
Title insurance on refinances (Section 4). If the Director finds it serves the companies and the public, the existing title acceptance pilot would become an ongoing nationwide program. Fannie or Freddie could then accept an automated title review instead of a lender’s title policy on eligible refinances. The Director must also consider extending it to low-risk refinances above the current 80% LTV limit, and cutting loan-level price adjustments and other fees on them. Any savings must pass through to borrowers.
USDA and VA direct loans (Section 5). The Secretaries of Agriculture and Veterans Affairs must cut interest rates on home loans their departments make directly. That applies only “consistent with applicable law” and available funding, and the order sets no rate or date. These differ from the guaranteed loans private lenders make.
What happens next
Neither the PMI cancellation pilot nor the title program has a date. As of November 9, 2026, FHFA, Fannie Mae and Freddie Mac had not announced the pilot or its terms.
