(MONEY Magazine) - QUESTION: I tried to get my private mortgage insurance (PMI) removed, believing that I could easily qualify because my condo had appreciated in value. I called Countrywide, my lender, and they said I needed an appraisal. I used the person they recommended ($580!), but Countrywide still turned me down. What gives? --Kristine Reynolds, Brooklyn

ANSWER You were smart to want to lower your monthly nut, but unfortunately there were a few hidden obstacles that derailed your efforts.

First, a quick lesson. Lenders require you to buy PMI when you cough up less than 20% as a down payment. This insurance protects lenders in case you default on your loan, which is why they're not usually in a rush to remove the coverage. But nothing is forever: The Federal Homeowners Protection Act says lenders must automatically cancel the policy after you've paid off 22% of your original loan, and you can request that the PMI be terminated when your equity reaches 20%. "With strong appreciation, you may have reached that golden level and not know it," says mortgage analyst Keith Gumbinger.

But there's another typical prerequisite. We dug through your mortgage disclosure notice, and page 3 states the conditions under which the PMI can be ended--including that you need two years of on-time payments before you can request the halt, equity or no equity. At the time, you'd had the mortgage only 16 months. Whoops.

Anyway, in good faith you shelled out $580 for an appraisal but were turned down because you were never eligible in the first place. (They should have told you this instead of advising you to go get the appraisal.) Worse, you overpaid by half because a PMI appraisal is less detailed and expensive than one you might get for, say, a mortgage refinance. (They could have told you this too.)

Countrywide was conciliatory when we asked that your request be reprocessed, and you are now officially PMI-free. You were also refunded $305 for the unnecessary appraisal. Plus, you were sent another $73 to help make up for PMI premiums you paid during the months you thought it should be lifted.

Need an advocate or some good advice? E-mail Ellen McGirt at

money_helps@moneymail.com.

Reporting by Judy Feldman contributed to this article.