Have equity in your home? Want a lower payment? An appraisal from Timely Appraisal Services can help you get rid of your PMI.When buying a house, a 20% down payment is usually the standard. The lender's risk is often only the difference between the home value and the sum outstanding on the loan, so the 20% provides a nice buffer against the expenses of foreclosure, reselling the home, and typical value changes on the chance that a purchaser doesn't pay. Banks were accepting down payments as low as 10, 5 and even 0 percent during the mortgage boom of the last decade. How does a lender manage the additional risk of the low down payment? The solution is Private Mortgage Insurance or PMI. PMI protects the lender in case a borrower doesn't pay on the loan and the worth of the home is less than the balance of the loan. Because the $40-$50 a month per $100,000 borrowed is compiled into the mortgage monthly payment and frequently isn't even tax deductible, PMI can be costly to a borrower. Unlike a piggyback loan where the lender consumes all the losses, PMI is lucrative for the lender because they acquire the money, and they get paid 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 can a home buyer prevent bearing the cost of PMI?The Homeowners Protection Act of 1998 requires the lenders on nearly all loans to automatically eliminate the PMI when the principal balance of the loan reaches 78 percent of the original loan amount. Savvy home owners can get off the hook a little earlier. The law states that, upon request of the home owner, the PMI must be dropped when the principal amount reaches only 80 percent. It can take many years to arrive at the point where the principal is only 20% of the initial loan amount, 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 abolishing PMI. So why pay it after the balance of your loan has dropped below the 80% mark? Even when nationwide trends forecast plummeting home values, be aware that real estate is local. Your neighborhood might not be heeding the national trends and/or your home could have acquired equity before things cooled off. The toughest thing for many home owners to know is just when their home's equity rises above the 20% point. A certified, licensed real estate appraiser can surely help. It's an appraiser's job to recognize the market dynamics of their area. At Timely Appraisal Services, we know when property values have risen or declined. We're masters at recognizing value trends in Quinlan, Hunt County and surrounding areas. Faced with data from an appraiser, the mortgage company will generally drop the PMI with little anxiety. At that time, the homeowner can delight in the savings from that point on.
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