Val Appraisal Services Inc can help you remove your Private Mortgage InsuranceA 20% down payment is usually the standard when buying a house. The lender's liability is usually only the difference between the home value and the amount outstanding on the loan, so the 20% supplies a nice cushion against the costs of foreclosure, reselling the home, and typical value fluctuations in the event a borrower is unable to pay. Banks were working with down payments down to 10, 5 and even 0 percent in the peak of last decade's mortgage boom. How does a lender manage the added risk of the low down payment? The solution is Private Mortgage Insurance or PMI. PMI takes care of the lender in the event a borrower doesn't pay on the loan and the worth of the house is lower than the balance of the loan. PMI is costly to a borrower in that the $40-$50 a month per $100,000 borrowed is compiled into the mortgage monthly payment and oftentimes isn't even tax deductible. It's lucrative for the lender because they obtain the money, and they get the money if the borrower doesn't pay, contradictory to a piggyback loan where the lender takes in all the costs. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can buyers avoid bearing the expense of PMI?The Homeowners Protection Act of 1998 requires 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. The law designates that, at the request of the homeowner, the PMI must be abandoned when the principal amount reaches only 80 percent. So, wise home owners can get off the hook a little early. It can take countless years to arrive at the point where the principal is just 20% of the original amount borrowed, so 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 abolishing PMI. So why should you pay it after your loan balance has fallen below the 80% mark? Even when nationwide trends signify plunging home values, understand that real estate is local. Your neighborhood may not be reflecting the national trends and/or your home could have secured equity before things cooled off. The hardest thing for almost all homeowners to know is just when their home's equity rises above the 20% point. A certified, licensed real estate appraiser can certainly help. It's an appraiser's job to understand the market dynamics of their area. At Val Appraisal Services Inc, we know when property values have risen or declined. We're experts at determining value trends in Middleburg, Clay County and surrounding areas. When faced with information from an appraiser, the mortgage company will usually drop the PMI with little effort. At which time, the homeowner can delight in the savings from that point on.
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