Let Property Valuation Group help you decide if you can get rid of your PMIIt's typically inferred that a 20% down payment is common when purchasing a home. Since the risk for the lender is usually only the difference between the home value and the sum remaining on the loan, the 20% provides a nice buffer against the charges of foreclosure, reselling the home, and typical value changesin the event a purchaser defaults. Banks were taking down payments down to 10, 5 and often 0 percent in the peak of last decade's mortgage boom. A lender is able to manage the additional risk of the low down payment with Private Mortgage Insurance or PMI. This additional plan protects the lender in case a borrower is unable to pay on the loan and the worth of the home is lower than what the borrower still owes on the loan. Because the $40-$50 a month per $100,000 borrowed is rolled into the mortgage monthly payment and many times isn't even tax deductible, PMI is pricey to a borrower. It's money-making for the lender because they secure the money, and they receive payment if the borrower doesn't pay, different from a piggyback loan where the lender absorbs all the damages. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can a homeowner keep from paying PMI?The Homeowners Protection Act of 1998 requires the lenders on most loans to automatically cease the PMI when the principal balance of the loan equals 78 percent of the initial loan amount. The law pledges that, at the request of the homeowner, the PMI must be abandoned when the principal amount reaches only 80 percent. So, acute home owners can get off the hook sooner than expected. Because it can take many years to get to the point where the principal is just 20% of the initial loan amount, it's crucial to know how your home has increased in value. After all, every bit of appreciation you've accomplished over time counts towards abolishing PMI. So why pay it after your loan balance has dropped below the 80% threshold? Your neighborhood may not be reflecting the national trends and/or your home might have secured equity before things calmed down, so even when nationwide trends forecast declining home values, you should realize that real estate is local. The difficult thing for almost all home owners 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 Property Valuation Group, we know when property values have risen or declined. We're experts at identifying value trends in Ferndale, Oakland County and surrounding areas. When faced with information from an appraiser, the mortgage company will often eliminate the PMI with little trouble. At that time, the home owner can delight in the savings from that point on.
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