Have equity in your home? Want a lower payment? An appraisal from DenverT Appraisal can help you get rid of your PMI.It's typically understood that a 20% down payment is accepted when buying a house. The lender's risk is generally only the remainder between the home value and the sum outstanding on the loan, so the 20% adds a nice cushion against the charges of foreclosure, selling the home again, and typical value fluctuations on the chance that a purchaser defaults. Banks were working with down payments down to 10, 5 and often 0 percent in the peak of last decade's mortgage boom. How does a lender endure the additional risk of the small down payment? The solution is Private Mortgage Insurance or PMI. This supplementary plan protects the lender if a borrower is unable to pay on the loan and the market price of the home is less than what the borrower still owes on the loan. PMI is pricey to a borrower on the grounds that the $40-$50 a month per $100,000 borrowed is lumped into the mortgage payment and oftentimes isn't even tax deductible. It's favorable for the lender because they acquire the money, and they receive payment if the borrower is unable to pay, unlike 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 homebuyers avoid paying PMI?With the implementation of The Homeowners Protection Act of 1998, on most loans lenders are required to automatically eliminate the PMI when the principal balance of the loan reaches 78 percent of the initial loan amount. The law guarantees that, upon request of the homeowner, the PMI must be abandoned when the principal amount reaches just 80 percent. So, smart homeowners can get off the hook a little earlier. Since it can take many years to get to the point where the principal is only 20% of the original amount borrowed, it's essential to know how your home has increased in value. After all, any appreciation you've accomplished over the years counts towards dismissing PMI. So why pay it after the balance of your loan has dropped below the 80% threshold? Your neighborhood may not be following the national trends and/or your home could have gained equity before things cooled off, so even when nationwide trends indicate falling home values, you should realize that real estate is local. The difficult thing for almost all homeowners to understand is just when their home's equity rises above the 20% point. A certified, licensed real estate appraiser can certainly help. As appraisers, it's our job to keep up with the market dynamics of our area. At DenverT Appraisal, we're masters at identifying value trends in West End, Moore County and surrounding areas, and we know when property values have risen or declined. When faced with data from an appraiser, the mortgage company will generally do away with the PMI with little anxiety. At that time, the home owner can enjoy the savings from that point on.
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