Homeowner’s Protection Act (HPA) of 1998

This act applies to mortgages obtained on or after July 29, 1999. But has requirements for loans which were obtained before this date. This law doesn’t cover FHA & VA government guaranteed loans and has different requirements for mortgages which are classified as high risk. The standards for high risk loans have not been specified in this act but it permits Freddie Mac & Fannie Mae to issue guidance regarding mortgages which conform to secondary market loan limits.

According to this act, lenders are required to provide certain notifications & disclosures concerning private mortgage insurance. This act requires lenders to inform borrowers of their rights under the act and allows for borrower initiated cancellation of pmi. And the lender is required to terminate the pmi when equity level in the home reaches a certain level.

Reference site: Homeowners Protection Act of 1998