Q. Private mortgage insurance isn't meant to last the full term of the loan is it? When can I ask the mortgage company to stop charging me PMI?

A. No, it's only required until you have built up 20% equity in your home. Most homeowners reach that threshold through a combination of their home appreciating in value and reducing what they owe through their monthly payments.

Let's say, for example, you bought a home for $100,000 and borrowed $95,000 to pay for it. You would have only 5% equity in the home and have to pay PMI.

But when the balance on your loan declined to $90,000 and the price of your home appreciated to $113,000 you would have 20% equity and be eligible to drop the mortgage insurance.

To get the lender to cancel PMI you may have to pay for an appraisal ($200-$400, depending on where you live) to prove that you have the minimum amount of equity. But be sure to talk to your lender before getting an appraisal to make sure you know exactly what it will require.