Have equity in your home? Want a lower payment? An appraisal from Appraisal-One can help you get rid of your PMI.It's largely understood that a 20% down payment is accepted when purchasing a home. Since the risk for the lender is often only the difference between the home value and the amount due on the loan, the 20% supplies a nice cushion against the charges of foreclosure, selling the home again, and typical value fluctuationsin the event a borrower is unable to pay. Banks were working with down payments down to 10, 5 and even 0 percent during the mortgage boom of the mid 2000s. How does a lender handle the added risk of the small down payment? The solution is Private Mortgage Insurance or PMI. This added plan guards the lender in case a borrower is unable to pay on the loan and the worth of the property is lower than the loan balance. Because the $40-$50 a month per $100,000 borrowed is bundled into the mortgage payment and often isn't even tax deductible, PMI can be pricey to a borrower. It's money-making for the lender because they collect the money, and they get the money if the borrower defaults, contradictory to a piggyback loan where the lender takes in 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 a homeowner avoid bearing the expense of PMI?With the employment of The Homeowners Protection Act of 1998, on most loans lenders are obligated to automatically cease the PMI when the principal balance of the loan reaches 78 percent of the primary loan amount. Wise homeowners can get off the hook sooner than expected. The law guarantees that, upon request of the homeowner, the PMI must be dropped when the principal amount reaches just 80 percent. It can take countless years to reach the point where the principal is just 20% of the original loan amount, so it's crucial to know how your home has appreciated in value. After all, all of the appreciation you've acquired over time counts towards removing PMI. So why should you pay it after your loan balance has dropped below the 80% threshold? Despite the fact that nationwide trends predict falling home values, be aware that real estate is local. Your neighborhood may not be minding the national trends and/or your home may have secured equity before things settled down. The hardest thing for most home owners to know is just when their home's equity goes over the 20% point. An accredited, licensed real estate appraiser can surely help. It's an appraiser's job to understand the market dynamics of their area. At Appraisal-One, we're masters at recognizing value trends in Huntington Beach, Orange County and surrounding areas, and we know when property values have risen or declined. When faced with figures from an appraiser, the mortgage company will usually cancel the PMI with little anxiety. At which time, the home owner can retain the savings from that point on.
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