Under the Homeowners Protection Act (HPA), a borrower with a good payment history on a conventional loan has the right to request cancellation of PMI once the loan balance reaches which threshold based on the original property value?

Correct answer: 80% LTV

The Homeowners Protection Act (HPA) of 1998 gives borrowers the right to REQUEST cancellation of PMI when the mortgage balance reaches 80% of the original value of the property (based on the original amortization schedule or actual payments), provided the borrower has a good payment history. At 78% LTV, the lender is required to AUTOMATICALLY cancel PMI — this is the automatic termination threshold, not the borrower-request threshold. The 75% threshold is not a standard HPA milestone. The 85% threshold is not associated with PMI cancellation under the HPA.