Let Appraisal House, Inc. help you decide if you can eliminate your PMIA 20% down payment is typically accepted when getting a mortgage. The lender's liability is generally only the remainder between the home value and the sum remaining on the loan, so the 20% adds a nice cushion against the expenses of foreclosure, reselling the home, and regular value variations in the event a purchaser defaults. During the recent mortgage upturn of the last decade, it became widespread to see lenders commanding down payments of 10, 5 or often 0 percent. A lender is able to handle the added risk of the low down payment with Private Mortgage Insurance or PMI. This added plan guards the lender if a borrower defaults on the loan and the value of the home is lower than what is owed on the loan. Since the $40-$50 a month per $100,000 borrowed is rolled into the mortgage monthly payment and generally isn't even tax deductible, PMI can be expensive to a borrower. Opposite from a piggyback loan where the lender absorbs all the damages, PMI is advantageous for the lender because they acquire the money, and they receive payment if the borrower is unable to pay. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How homeowners can avoid paying PMIWith the implementation of The Homeowners Protection Act of 1998, on most loans lenders are obligated to automatically cease the PMI when the principal balance of the loan equals 78 percent of the beginning loan amount. The law designates that, at the request of the home owner, the PMI must be released when the principal amount reaches only 80 percent. So, smart homeowners can get off the hook a little earlier. It can take many years to reach the point where the principal is just 20% of the initial amount borrowed, so it's essential to know how your home has increased in value. After all, all of the appreciation you've gained over the years counts towards removing PMI. So why pay it after your loan balance has fallen below the 80% threshold? Your neighborhood may not be minding the national trends and/or your home might have secured equity before things cooled off, so even when nationwide trends predict falling home values, you should understand that real estate is local. An accredited, licensed real estate appraiser can help homeowners 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 understand the market dynamics of our area. At Appraisal House, Inc., we know when property values have risen or declined. We're masters at determining value trends in Destin, Okaloosa County and surrounding areas. When faced with information from an appraiser, the mortgage company will usually drop the PMI with little effort. At which time, the home owner can retain the savings from that point on.
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