Let Rush Hour Appraisals help you figure out if you can cancel your PMIIt's largely known that a 20% down payment is common when getting a mortgage. 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 costs of foreclosure, reselling the home, and regular value variations in the event a borrower doesn't pay. During the recent mortgage upturn of the mid 2000s, it was widespread to see lenders commanding down payments of 10, 5 or sometimes 0 percent. A lender is able to endure the increased risk of the low down payment with Private Mortgage Insurance or PMI. This additional policy covers the lender in the event a borrower is unable to pay on the loan and the market price of the house is less than the loan balance. PMI can be expensive to a borrower on the grounds that the $40-$50 a month per $100,000 borrowed is rolled into the mortgage monthly payment and oftentimes isn't even tax deductible. It's lucrative for the lender because they obtain the money, and they receive payment if the borrower doesn't pay, different from a piggyback loan where the lender takes in 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 buyer avoid paying PMI?With the employment of The Homeowners Protection Act of 1998, on nearly all loans lenders are obligated to automatically stop the PMI when the principal balance of the loan reaches 78 percent of the primary loan amount. The law promises that, upon request of the home owner, the PMI must be dropped when the principal amount reaches only 80 percent. So, wise homeowners can get off the hook a little earlier. Considering it can take many years to arrive at the point where the principal is just 20% of the initial amount borrowed, it's crucial to know how your home has appreciated in value. After all, every bit of appreciation you've gained over the years counts towards dismissing PMI. So why pay it after the balance of your loan has dropped below the 80% mark? Even when nationwide trends indicate decreasing home values, be aware that real estate is local. Your neighborhood might not be following the national trends and/or your home may have gained equity before things calmed down. The toughest thing for many 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. It's an appraiser's job to know the market dynamics of their area. At Rush Hour Appraisals, we're experts at identifying value trends in Greenville, Greenville County and surrounding areas, and we know when property values have risen or declined. When faced with figures from an appraiser, the mortgage company will most often remove the PMI with little trouble. At which time, the home owner can retain the savings from that point on.
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