Certified Appraisals can help you remove your Private Mortgage InsuranceWhen purchasing a home, a 20% down payment is usually the standard. Considering the liability for the lender is often only the difference between the home value and the amount outstanding on the loan, the 20% supplies a nice cushion against the charges of foreclosure, reselling the home, and natural value changeson the chance that a purchaser doesn't pay. Banks were working with down payments as low as 10, 5 and even 0 percent in the peak of last decade's mortgage boom. How does a lender manage the increased risk of the low down payment? The solution is Private Mortgage Insurance or PMI. This supplementary plan takes care of the lender in case a borrower is unable to pay on the loan and the market price of the property is less than the loan balance. Since the $40-$50 a month per $100,000 borrowed is compiled into the mortgage monthly payment and often isn't even tax deductible, PMI is pricey to a borrower. Unlike a piggyback loan where the lender takes in all the losses, PMI is profitable for the lender because they secure the money, and they get the money 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 home buyers can avoid bearing the cost of PMIWith the implementation of The Homeowners Protection Act of 1998, on most loans lenders are obligated to automatically eliminate the PMI when the principal balance of the loan equals 78 percent of the beginning loan amount. Wise home owners can get off the hook a little early. The law states that, at the request of the homeowner, the PMI must be abandoned when the principal amount equals just 80 percent. It can take many years to get to the point where the principal is just 20% of the initial amount of the loan, so it's crucial to know how your home has appreciated in value. After all, any appreciation you've obtained over time counts towards removing PMI. So why should you pay it after the balance of your loan has dropped below the 80% threshold? Even when nationwide trends indicate falling home values, be aware that real estate is local. Your neighborhood may not be adopting the national trends and/or your home may have gained equity before things simmered down. The toughest thing for many homeowners to understand is just when their home's equity rises above the 20% point. A certified, licensed real estate appraiser can surely help. As appraisers, it's our job to keep up with the market dynamics of our area. At Certified Appraisals, we know when property values have risen or declined. We're masters at recognizing value trends in Conway, Horry County and surrounding areas. Faced with data from an appraiser, the mortgage company will generally eliminate the PMI with little effort. At that time, the homeowner can enjoy the savings from that point on.
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