Have equity in your home? Want a lower payment? An appraisal from APPRAISAL EXPRESS, INC can help you get rid of your PMI.It's typically known that a 20% down payment is common when purchasing a home. Considering the liability for the lender is generally only the remainder between the home value and the sum due on the loan, the 20% provides a nice cushion against the expenses of foreclosure, reselling the home, and natural value variationson the chance that a purchaser defaults. During the recent mortgage upturn of the mid 2000s, it became widespread to see lenders requiring down payments of 10, 5 or often 0 percent. A lender is able to endure the increased risk of the small down payment with Private Mortgage Insurance or PMI. This supplemental policy protects the lender in the event a borrower defaults on the loan and the worth of the property is lower than the balance of the loan. Since the $40-$50 a month per $100,000 borrowed is rolled into the mortgage monthly payment and often isn't even tax deductible, PMI can be expensive to a borrower. It's lucrative for the lender because they acquire the money, and they receive payment if the borrower is unable to pay, different from a piggyback loan where the lender takes in all the damages. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can a homebuyer refrain from bearing the cost of PMI?With the employment of The Homeowners Protection Act of 1998, on most loans lenders are obligated to automatically stop the PMI when the principal balance of the loan equals 78 percent of the initial loan amount. Wise homeowners can get off the hook ahead of time. The law designates that, upon request of the homeowner, the PMI must be released when the principal amount equals only 80 percent. Since it can take countless years to arrive at the point where the principal is only 20% of the original loan amount, it's essential to know how your home has increased in value. After all, every bit of appreciation you've accomplished over time counts towards removing PMI. So why pay it after the balance of your loan has dropped below the 80% mark? Despite the fact that nationwide trends predict plummeting home values, be aware that real estate is local. Your neighborhood might not be heeding the national trends and/or your home may have gained equity before things settled down. A certified, licensed real estate appraiser can help home owners understand just when their home's equity goes over the 20% point, as it's a difficult thing to know. As appraisers, it's our job to keep up with the market dynamics of our area. At APPRAISAL EXPRESS, INC, we're experts at determining value trends in Durango, La Plata County and surrounding areas, and we know when property values have risen or declined. Faced with figures from an appraiser, the mortgage company will usually drop the PMI with little trouble. At which time, the home owner can relish the savings from that point on.
Want to learn more about PMI and the Homeowners Protection Act? Click this link: |