Based on your description, you will need to go off the $260,000. This is how much you currently owe on your home. Check your modification paperwork. But it sounds like the bank added to your principal amount to help you catch up. Every modification can be different, so it is tough to answer your question without a little more information. When cancelling private mortgage insurance, you need to go off of combined loan-to-value or CLTV. Meaning the total amount you owe on your home needs to be 80% or less of current market value.