Let Golden Rule Appraisals help you learn if you can get rid of your PMIIt's generally known that a 20% down payment is the standard when buying a house. The lender's risk is generally only the remainder between the home value and the sum due on the loan, so the 20% provides a nice buffer against the costs of foreclosure, selling the home again, and typical value changes on the chance that a borrower defaults. During the recent mortgage upturn of the last decade, it was widespread to see lenders taking down payments of 10, 5 or sometimes 0 percent. A lender is able to handle the additional risk of the minimal down payment with Private Mortgage Insurance or PMI. PMI protects the lender in case a borrower defaults on the loan and the value of the property is less than what is owed on the loan. PMI can be expensive to a borrower on the grounds that the $40-$50 a month per $100,000 borrowed is bundled into the mortgage payment and many times isn't even tax deductible. It's advantageous for the lender because they obtain the money, and they get paid if the borrower doesn't pay, contradictory to a piggyback loan where the lender absorbs all the deficits. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How home owners can keep from paying PMIWith the implementation of The Homeowners Protection Act of 1998, on nearly all loans lenders are forced to automatically terminate the PMI when the principal balance of the loan reaches 78 percent of the beginning loan amount. Acute homeowners can get off the hook ahead of time. The law states that, at the request of the homeowner, the PMI must be dropped when the principal amount reaches only 80 percent. It can take many years to arrive at the point where the principal is just 20% of the original amount of the loan, so it's crucial to know how your home has appreciated in value. After all, every bit of appreciation you've acquired over the years counts towards abolishing PMI. So what's the reason for paying it after your loan balance has fallen below the 80% mark? Your neighborhood might not be following the national trends and/or your home may have secured equity before things simmered down, so even when nationwide trends indicate declining home values, you should understand that real estate is local. The hardest thing for many home owners to understand is just when their home's equity goes over the 20% point. A certified, licensed real estate appraiser can surely help. It is an appraiser's job to understand the market dynamics of their area. At Golden Rule Appraisals, we're masters at recognizing value trends in Edmond, Oklahoma County and surrounding areas, and we know when property values have risen or declined. Faced with information from an appraiser, the mortgage company will usually remove the PMI with little effort. At which time, the home owner can relish the savings from that point on.
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