Let Precision Valuation help you determine if you can get rid of your PMIIt's largely inferred that a 20% down payment is accepted when getting a mortgage. The lender's liability is often only the difference between the home value and the sum outstanding on the loan, so the 20% adds a nice cushion against the costs of foreclosure, selling the home again, and typical value fluctuations on the chance that a purchaser defaults. Lenders were working with down payments as low as 10, 5 and often 0 percent in the peak of last decade's mortgage boom. A lender is able to endure the increased risk of the small down payment with Private Mortgage Insurance or PMI. PMI protects the lender in case a borrower is unable to pay on the loan and the value of the home is less than the balance of the loan. PMI can be expensive to a borrower because the $40-$50 a month per $100,000 borrowed is lumped into the mortgage payment and frequently isn't even tax deductible. It's advantageous for the lender because they secure the money, and they get the money if the borrower doesn't pay, contradictory to a piggyback loan where the lender absorbs all the costs. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can homeowners prevent bearing the expense of PMI?The Homeowners Protection Act of 1998 forces the lenders on nearly all loans to automatically terminate the PMI when the principal balance of the loan reaches 78 percent of the beginning loan amount. The law designates that, upon request of the home owner, the PMI must be released when the principal amount equals just 80 percent. So, smart homeowners can get off the hook ahead of time. Since it can take countless years to get to the point where the principal is just 20% of the original loan amount, it's important to know how your home has grown in value. After all, all of the appreciation you've gained over time counts towards dismissing PMI. So why pay it after the balance of your loan has fallen below the 80% threshold? Even when nationwide trends indicate decreasing home values, be aware that real estate is local. Your neighborhood might not be minding the national trends and/or your home could have gained equity before things settled down. A certified, licensed real estate appraiser can help homeowners understand just when their home's equity goes over the 20% point, as it's a difficult thing to know. It is an appraiser's job to know the market dynamics of their area. At Precision Valuation, we're masters at analyzing value trends in Dublin, Franklin County and surrounding areas, and we know when property values have risen or declined. Faced with figures from an appraiser, the mortgage company will most often do away with the PMI with little anxiety. At which time, the home owner can relish the savings from that point on.
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