Astute Appraisals, Inc. can help you remove your Private Mortgage InsuranceIt's largely inferred that a 20% down payment is the standard when getting a mortgage. Because the liability for the lender is generally only the difference between the home value and the amount remaining on the loan, the 20% provides a nice cushion against the costs of foreclosure, selling the home again, and typical value changesin the event a borrower doesn't pay. The market was taking down payments down to 10, 5 and often 0 percent during the mortgage boom of the mid 2000s. A lender is able to endure the additional risk of the minimal down payment with Private Mortgage Insurance or PMI. PMI guards the lender in case a borrower doesn't pay on the loan and the worth of the home is lower than the balance of the loan. Since the $40-$50 a month per $100,000 borrowed is rolled into the mortgage payment and many times isn't even tax deductible, PMI is pricey to a borrower. Contradictory to a piggyback loan where the lender absorbs all the damages, PMI is favorable for the lender because they acquire the money, and they receive payment if the borrower doesn't pay. 
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 paying PMIThe Homeowners Protection Act of 1998 makes the lenders on most loans to automatically cease the PMI when the principal balance of the loan reaches 78 percent of the primary loan amount. Savvy homeowners can get off the hook a little earlier. The law states that, at the request of the homeowner, the PMI must be abandoned when the principal amount equals only 80 percent. It can take countless years to get to the point where the principal is just 20% of the initial amount of the loan, so it's important to know how your home has appreciated in value. After all, all of the appreciation you've achieved over the years counts towards dismissing PMI. So why should you pay it after your loan balance has dropped below the 80% mark? Even when nationwide trends forecast plummeting home values, realize that real estate is local. Your neighborhood might not be reflecting the national trends and/or your home may have secured equity before things cooled off. The toughest thing for most homeowners to understand is just when their home's equity goes over the 20% point. A certified, licensed real estate appraiser can definitely help. As appraisers, it's our job to recognize the market dynamics of our area. At Astute Appraisals, Inc., we're experts at pinpointing value trends in Columbia, Howard County and surrounding areas, and we know when property values have risen or declined. Faced with information from an appraiser, the mortgage company will generally drop the PMI with little anxiety. At which time, the home owner can retain the savings from that point on.
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