Have equity in your home? Want a lower payment? An appraisal from Coleman Appraisal Service can help you get rid of your PMI.A 20% down payment is typically the standard when purchasing a home. Considering the risk for the lender is usually only the remainder between the home value and the sum due on the loan, the 20% adds a nice buffer against the costs of foreclosure, selling the home again, and regular value changeson the chance that a borrower defaults. During the recent mortgage upturn of the mid 2000s, it was customary to see lenders requiring down payments of 10, 5 or sometimes 0 percent. How does a lender manage the increased risk of the small down payment? The answer is Private Mortgage Insurance or PMI. PMI takes care of the lender in the event a borrower is unable to pay on the loan and the market price of the house is lower than the balance of the loan. Because the $40-$50 a month per $100,000 borrowed is compiled into the mortgage payment and often isn't even tax deductible, PMI can be pricey to a borrower. Contradictory to a piggyback loan where the lender consumes all the deficits, PMI is beneficial for the lender because they collect the money, and they get paid if the borrower defaults. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How homebuyers can avoid bearing the cost of PMIThe Homeowners Protection Act of 1998 makes the lenders on most loans to automatically terminate the PMI when the principal balance of the loan reaches 78 percent of the initial loan amount. Acute homeowners can get off the hook sooner than expected. The law states that, at the request of the home owner, the PMI must be released when the principal amount reaches just 80 percent. Since it can take many years to reach the point where the principal is only 20% of the original amount of the loan, it's crucial to know how your home has appreciated in value. After all, any appreciation you've gained over time counts towards dismissing PMI. So why pay it after your loan balance has dropped below the 80% mark? Despite the fact that nationwide trends forecast falling home values, realize that real estate is local. Your neighborhood may not be heeding the national trends and/or your home could have secured equity before things cooled off. The hardest thing for almost all home owners to understand is just when their home's equity rises above the 20% point. A certified, licensed real estate appraiser can certainly help. It is an appraiser's job to know the market dynamics of their area. At Coleman Appraisal Service, we're experts at identifying value trends in Vassar, Tuscola County and surrounding areas, and we know when property values have risen or declined. When faced with data from an appraiser, the mortgage company will most often remove the PMI with little trouble. At which time, the home owner can enjoy the savings from that point on.
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