Let Tri-County Appraisals help you determine if you can get rid of your PMIWhen buying a house, a 20% down payment is usually the standard. The lender's risk is oftentimes only the difference between the home value and the sum outstanding on the loan, so the 20% supplies a nice cushion against the charges of foreclosure, reselling the home, and typical value fluctuations on the chance that a purchaser defaults. The market was working with down payments down to 10, 5 and often 0 percent in the peak of last decade's mortgage boom. How does a lender endure the additional risk of the low down payment? The answer is Private Mortgage Insurance or PMI. This supplemental policy covers the lender in the event a borrower doesn't pay on the loan and the value of the house is less than what the borrower still owes on the loan. PMI can be pricey to a borrower on the grounds that the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and many times isn't even tax deductible. It's profitable for the lender because they collect the money, and they get the money if the borrower is unable to pay, unlike a piggyback loan where the lender consumes all the losses. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How homeowners can keep from bearing the expense of PMIWith the utilization of The Homeowners Protection Act of 1998, on nearly all loans lenders are required to automatically terminate the PMI when the principal balance of the loan reaches 78 percent of the initial loan amount. The law stipulates that, upon request of the homeowner, the PMI must be abandoned when the principal amount reaches only 80 percent. So, smart home owners can get off the hook a little earlier. Since it can take countless years to reach the point where the principal is only 20% of the initial loan amount, it's important to know how your home has appreciated in value. After all, all of the appreciation you've obtained over the years counts towards removing PMI. So why should you pay it after your loan balance has dropped below the 80% mark? Despite the fact that nationwide trends signify plunging home values, realize that real estate is local. Your neighborhood might not be minding the national trends and/or your home might have secured equity before things cooled off. 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 difficult thing to know. It's an appraiser's job to keep up with the market dynamics of their area. At Tri-County Appraisals, we know when property values have risen or declined. We're experts at determining value trends in Loveland, Larimer County and surrounding areas. Faced with information from an appraiser, the mortgage company will often do away with the PMI with little trouble. At which time, the homeowner can retain the savings from that point on.
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