Termination of insurance during term of indebtedness — Exception — Required conditions — Application to residential mortgage transactions — Compliance with federal requirements.

RCW 61.10.030
in effect
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(1) Except when a statute, regulation, rule, or written guideline promulgated by an institutional third party applicable to a residential mortgage transaction purchased in whole or in part by an institutional third party specifically prohibits cancellation during the term of indebtedness, the lender or servicer of a residential mortgage transaction may not charge or collect future payments from a borrower for mortgage insurance, and the borrower is not obligated to make such payments, if all of the following conditions are satisfied: (a) The borrower makes a written request to terminate the obligation to make future payments for mortgage insurance; (b) The residential mortgage transaction is at least two years old; (c) The outstanding principal balance of the residential loan is not greater than eighty percent of the current fair market value of the property and is: (i) For loans made for the purchase of the property, less than eighty percent of the lesser of the sales price or the appraised value at the time the transaction is entered into; or (ii) For all other residential mortgage transactions, less than eighty percent of the appraised value at the time the residential loan transaction was entered into. The lender or servicer may request that a current appraisal be done to verify the outstanding principal balance is less than eighty percent of the current fair market value of the property; unless otherwise agreed to in writing, the lender or servicer selects the appraiser and splits the cost with the borrower; (d) The borrower's scheduled payment of monthly installments or principal, interest, and any escrow obligations is current at the time the borrower requests termination of his or her obligation to continue to pay for mortgage insurance, those installments have not been more than thirty days late in the last twelve months, and the borrower has not been assessed more than one late penalty over the past twelve months; (e) A notice of default has not been recorded against the property as the result of a nonmonetary default in the previous twelve months. (2) This section applies to residential mortgage transactions entered into on or after July 1, 1998. (3) This section does not apply to: (a) Any residential mortgage transaction that is funded in whole or in part pursuant to authority granted by statute, regulation, or rule that, as a condition of that funding, prohibits or limits termination of payments for mortgage insurance during the term of the indebtedness; or (b) Any mortgage funded with bond proceeds issued under an indenture requiring mortgage insurance for the life of the loan. (4) If the residential mortgage transaction will be or has been sold in whole or in part to an institutional third party, adherence to the institutional third party's standards for termination of future payments for mortgage insurance shall be deemed in compliance with this section. (5) A lender or person servicing a residential mortgage transaction who complies with federal requirements, as now or hereafter enacted, governing the cancellation of mortgage insurance shall be deemed in compliance with this section. (1) Except when a statute, regulation, rule, or written guideline promulgated by an institutional third party applicable to a residential mortgage transaction purchased in whole or in part by an institutional third party specifically prohibits cancellation during the term of indebtedness, the lender or servicer of a residential mortgage transaction may not charge or collect future payments from a borrower for mortgage insurance, and the borrower is not obligated to make such payments, if all of the following conditions are satisfied: (a) The borrower makes a written request to terminate the obligation to make future payments for mortgage insurance; (b) The residential mortgage transaction is at least two years old; (c) The outstanding principal balance of the residential loan is not greater than eighty percent of the current fair market value of the property and is: (i) For loans made for the purchase of the property, less than eighty percent of the lesser of the sales price or the appraised value at the time the transaction is entered into; or (ii) For all other residential mortgage transactions, less than eighty percent of the appraised value at the time the residential loan transaction was entered into. The lender or servicer may request that a current appraisal be done to verify the outstanding principal balance is less than eighty percent of the current fair market value of the property; unless otherwise agreed to in writing, the lender or servicer selects the appraiser and splits the cost with the borrower; (d) The borrower's scheduled payment of monthly installments or principal, interest, and any escrow obligations is current at the time the borrower requests termination of his or her obligation to continue to pay for mortgage insurance, those installments have not been more than thirty days late in the last twelve months, and the borrower has not been assessed more than one late penalty over the past twelve months; (e) A notice of default has not been recorded against the property as the result of a nonmonetary default in the previous twelve months. (2) This section applies to residential mortgage transactions entered into on or after July 1, 1998. (3) This section does not apply to: (a) Any residential mortgage transaction that is funded in whole or in part pursuant to authority granted by statute, regulation, or rule that, as a condition of that funding, prohibits or limits termination of payments for mortgage insurance during the term of the indebtedness; or (b) Any mortgage funded with bond proceeds issued under an indenture requiring mortgage insurance for the life of the loan. (4) If the residential mortgage transaction will be or has been sold in whole or in part to an institutional third party, adherence to the institutional third party's standards for termination of future payments for mortgage insurance shall be deemed in compliance with this section. (5) A lender or person servicing a residential mortgage transaction who complies with federal requirements, as now or hereafter enacted, governing the cancellation of mortgage insurance shall be deemed in compliance with this section.
Source: WA Statutes (Official Site)URL: https://app.leg.wa.gov/RCW/default.aspx?cite=61.10&full=trueFetched: 6/29/2026

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