Appraisal-One can help you remove your Private Mortgage InsuranceWhen purchasing a home, a 20% down payment is usually the standard. Since the risk for the lender is oftentimes only the difference between the home value and the amount remaining on the loan, the 20% provides a nice cushion against the charges of foreclosure, selling the home again, and natural value fluctuationsin the event a purchaser defaults. During the recent mortgage boom of the last decade, it was common to see lenders commanding down payments of 10, 5 or even 0 percent. How does a lender handle the additional risk of the low down payment? The answer is Private Mortgage Insurance or PMI. PMI protects the lender if a borrower doesn't pay on the loan and the worth of the home is less than what is owed on the loan. Since the $40-$50 a month per $100,000 borrowed is rolled into the mortgage payment and many times isn't even tax deductible, PMI can be costly to a borrower. Opposite from a piggyback loan where the lender consumes all the deficits, PMI is beneficial for the lender because they secure the money, and they get paid if the borrower doesn't pay. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can homebuyers refrain from bearing the expense of PMI?The Homeowners Protection Act of 1998 forces the lenders on most loans to automatically terminate the PMI when the principal balance of the loan reaches 78 percent of the primary loan amount. The law promises that, at the request of the home owner, the PMI must be abandoned when the principal amount reaches only 80 percent. So, wise homeowners can get off the hook a little early. It can take countless years to arrive at the point where the principal is just 20% of the initial amount borrowed, so it's important to know how your home has grown in value. After all, all of the appreciation you've achieved over the years counts towards dismissing PMI. So what's the reason for paying it after your loan balance has dropped below the 80% mark? Even when nationwide trends forecast decreasing home values, be aware that real estate is local. Your neighborhood might not be heeding the national trends and/or your home might have gained equity before things calmed down. The hardest thing for almost all homeowners to understand is just when their home's equity goes over the 20% point. An accredited, licensed real estate appraiser can definitely help. As appraisers, it's our job to keep up with the market dynamics of our area. At Appraisal-One, we know when property values have risen or declined. We're experts at pinpointing value trends in Huntington Beach, Orange County and surrounding areas. When faced with figures from an appraiser, the mortgage company will generally remove the PMI with little anxiety. At that time, the home owner can relish the savings from that point on.
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