Appraisal First, Inc. can help you remove your Private Mortgage InsuranceWhen purchasing a home, a 20% down payment is typically the standard. The lender's risk is oftentimes only the remainder between the home value and the amount due on the loan, so the 20% provides a nice buffer against the charges of foreclosure, selling the home again, and typical value changes in the event a borrower defaults. Lenders were working with down payments down to 10, 5 and often 0 percent in the peak of last decade's mortgage boom. A lender is able to endure the added risk of the small down payment with Private Mortgage Insurance or PMI. This supplementary policy protects the lender if a borrower defaults on the loan and the value of the home is less than what the borrower still owes on the loan. Since the $40-$50 a month per $100,000 borrowed is rolled into the mortgage monthly payment and oftentimes isn't even tax deductible, PMI can be expensive to a borrower. Unlike a piggyback loan where the lender absorbs all the losses, PMI is profitable for the lender because they secure the money, and they receive payment if the borrower defaults. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How home owners can prevent bearing the cost of PMIThe Homeowners Protection Act of 1998 obligates the lenders on most loans to automatically eliminate the PMI when the principal balance of the loan reaches 78 percent of the primary loan amount. Smart home owners can get off the hook a little earlier. The law designates that, at the request of the home owner, the PMI must be released when the principal amount equals just 80 percent. Considering it can take countless 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 appreciated in value. After all, any appreciation you've obtained over the years counts towards dismissing PMI. So what's the reason for paying it after the balance of your loan has fallen below the 80% mark? Your neighborhood might not be following the national trends and/or your home could have gained equity before things simmered down, so even when nationwide trends forecast declining home values, you should realize that real estate is local. An accredited, licensed real estate appraiser can help home owners understand just when their home's equity goes over the 20% point, as it's a tough thing to know. As appraisers, it's our job to keep up with the market dynamics of our area. At Appraisal First, Inc., we know when property values have risen or declined. We're experts at pinpointing value trends in Springfield, Greene County and surrounding areas. Faced with figures from an appraiser, the mortgage company will most often cancel the PMI with little anxiety. At which time, the homeowner can enjoy the savings from that point on.
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