Have equity in your home? Want a lower payment? An appraisal from Salt Lake Appraising Company can help you get rid of your PMI.A 20% down payment is typically accepted when getting a mortgage. Considering the risk for the lender is often only the remainder between the home value and the amount due on the loan, the 20% provides a nice buffer against the costs of foreclosure, selling the home again, and regular value fluctuationson the chance that a purchaser doesn't pay. During the recent mortgage upturn of the mid 2000s, it was widespread to see lenders requiring down payments of 10, 5 or sometimes 0 percent. How does a lender endure the increased risk of the low down payment? The solution is Private Mortgage Insurance or PMI. This added policy takes care of the lender in case a borrower doesn't pay on the loan and the market price of the home is less than what is owed on the loan. Since the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and generally isn't even tax deductible, PMI can be pricey to a borrower. Contradictory to a piggyback loan where the lender takes in all the damages, PMI is favorable for the lender because they collect 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 can a homebuyer keep from paying PMI?With the implementation of The Homeowners Protection Act of 1998, on most loans lenders are obligated to automatically terminate the PMI when the principal balance of the loan equals 78 percent of the beginning loan amount. Smart home owners can get off the hook a little earlier. The law designates 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 arrive at the point where the principal is only 20% of the original amount borrowed, so it's important to know how your home has increased in value. After all, any appreciation you've gained over time counts towards dismissing PMI. So what's the reason for paying it after your loan balance has dropped below the 80% mark? Your neighborhood might not be adopting the national trends and/or your home might have secured equity before things simmered down, so even when nationwide trends signify declining home values, you should understand that real estate is local. The difficult thing for many homeowners to understand is just when their home's equity goes over the 20% point. An accredited, licensed real estate appraiser can surely help. It is an appraiser's job to keep up with the market dynamics of their area. At Salt Lake Appraising Company, we know when property values have risen or declined. We're masters at analyzing value trends in Draper, Salt Lake County and surrounding areas. Faced with data from an appraiser, the mortgage company will generally eliminate the PMI with little trouble. At that time, the home owner can retain the savings from that point on.
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