McCarthy Real Estate, Inc., Appraisal Services can help you remove your Private Mortgage InsuranceIt's typically inferred that a 20% down payment is accepted when buying a house. Since the risk for the lender is oftentimes only the remainder between the home value and the amount outstanding on the loan, the 20% adds a nice buffer against the costs of foreclosure, reselling the home, and typical value fluctuationson the chance that a purchaser defaults. Banks were working with down payments as low as 10, 5 and often 0 percent during the mortgage boom of the mid 2000s. A lender is able to handle the increased risk of the low down payment with Private Mortgage Insurance or PMI. This additional plan protects the lender if a borrower defaults on the loan and the value of the property is less than what the borrower still owes on the loan. Because the $40-$50 a month per $100,000 borrowed is compiled 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 takes in all the losses, PMI is beneficial for the lender because they obtain the money, and they get paid 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 home owners keep from paying PMI?The Homeowners Protection Act of 1998 forces the lenders on most loans to automatically cancel the PMI when the principal balance of the loan reaches 78 percent of the original loan amount. The law states that, upon request of the home owner, the PMI must be abandoned when the principal amount equals only 80 percent. So, acute homeowners can get off the hook ahead of time. It can take countless years to reach the point where the principal is just 20% of the original loan amount, so it's important to know how your home has increased in value. After all, every bit of appreciation you've achieved over the years counts towards dismissing PMI. So why pay it after your loan balance has dropped below the 80% mark? Even when nationwide trends hint at plummeting home values, understand that real estate is local. Your neighborhood may not be minding the national trends and/or your home could have secured equity before things calmed down. The hardest thing for almost all homeowners to know is just when their home's equity goes over the 20% point. An accredited, licensed real estate appraiser can certainly help. It's an appraiser's job to know the market dynamics of their area. At McCarthy Real Estate, Inc., Appraisal Services, we know when property values have risen or declined. We're experts at recognizing value trends in Marietta, Washington County and surrounding areas. When faced with information from an appraiser, the mortgage company will usually do away with the PMI with little trouble. At which time, the home owner can delight in the savings from that point on.
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