House with text about eliminating PMI through appraisal
by

Can a High Appraisal Eliminate PMI in Chicago?

If you’re a homeowner in Chicago or its surrounding suburbs, you may be wondering: can a high appraisal eliminate PMI? The answer is yes — in many cases, a strong home appraisal can be the key to removing private mortgage insurance (PMI) and lowering your monthly payments.

What Is PMI and Why Do You Pay It?

PMI is typically required when you purchase a home with less than a 20% down payment. For many Chicago buyers, especially first-time homeowners, it’s an added expense that can range from 0.5% to 1.5% of the loan amount per year (CFPB). While it helps lenders reduce their risk, it doesn’t directly benefit you as the homeowner.

How Can a High Appraisal Help Eliminate PMI?

The good news is that as property values rise in neighborhoods across Chicagoland — from Lincoln Park to Naperville, Oak Park to Schaumburg — your home’s equity may have increased since you bought it. If a new appraisal shows your home value has gone up enough that you now own 20% or more equity, you may be eligible to eliminate PMI (Investopedia).

For example:

  • You bought a home in Logan Square for $400,000 with 10% down.
  • Fast forward a few years: a new appraisal shows the home is now worth $475,000.
  • That increase in value could push your equity past the 20% mark, giving you grounds to request PMI removal.

Chicago Market Trends Support Higher Appraisals

According to the Illinois Realtors Association, Chicago-area home prices have steadily appreciated over the past few years, despite recent interest rate fluctuations. Many homeowners in Cook, DuPage, and Lake counties are sitting on more equity than they realize — making this an ideal time to explore whether a new appraisal could save them money each month.

Next Steps: Requesting PMI Removal

1. Contact your lender and ask about the process for PMI removal.

2. Hire a local, certified Chicago appraiser to conduct a professional valuation.

3. Submit the appraisal report to your lender as proof of sufficient equity.

At Real Valuation Services, we specialize in providing accurate, timely appraisals throughout the Chicagoland area. Whether you’re in the city or the suburbs, our expertise can help you determine if your home’s increased value qualifies you to eliminate PMI — and start saving on your mortgage today.

📞 Or call us at 317-270-0500 to schedule your appraisal