Let Lake Norman Appraisal Company help you learn if you can cancel your PMIIt's generally known that a 20% down payment is common when purchasing a home. The lender's liability is usually only the difference between the home value and the sum remaining on the loan, so the 20% adds a nice cushion against the charges of foreclosure, reselling the home, and natural value fluctuations in the event a borrower doesn't pay. Lenders were accepting down payments down to 10, 5 and even 0 percent in the peak of last decade's mortgage boom. A lender is able to endure the additional risk of the small down payment with Private Mortgage Insurance or PMI. PMI covers the lender in the event a borrower is unable to pay on the loan and the worth of the home is less than the loan balance. PMI is pricey to a borrower in that the $40-$50 a month per $100,000 borrowed is bundled into the mortgage monthly payment and many times isn't even tax deductible. Unlike a piggyback loan where the lender takes in all the deficits, PMI is money-making 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 homebuyer keep from paying PMI?The Homeowners Protection Act of 1998 requires the lenders on nearly all loans to automatically terminate the PMI when the principal balance of the loan reaches 78 percent of the beginning loan amount. Wise homeowners can get off the hook sooner than expected. The law promises that, at the request of the homeowner, the PMI must be abandoned when the principal amount reaches just 80 percent. It can take many years to get to the point where the principal is only 20% of the initial amount of the loan, so it's important to know how your home has increased in value. After all, any appreciation you've obtained over the years counts towards abolishing PMI. So why pay it after your loan balance has fallen below the 80% mark? Your neighborhood may not be adopting the national trends and/or your home could have secured equity before things cooled off, so even when nationwide trends hint at plummeting home values, you should realize that real estate is local. The hardest thing for almost all home owners to know 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 Lake Norman Appraisal Company, we're experts at analyzing value trends in Lake Norman and surrounding areas of Charlotte, and we know when property values have risen or declined. When faced with data from an appraiser, the mortgage company will generally cancel the PMI with little anxiety. At that time, the home owner can retain the savings from that point on.
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