Have equity in your home? Want a lower payment? An appraisal from Crowe Appraisals can help you get rid of your PMI.A 20% down payment is usually accepted when getting a mortgage. Since the liability for the lender is generally only the remainder between the home value and the amount remaining on the loan, the 20% adds a nice buffer against the charges of foreclosure, reselling the home, and natural value variationsin the event a borrower doesn't pay. During the recent mortgage upturn of the mid 2000s, it became customary to see lenders taking down payments of 10, 5 or sometimes 0 percent. How does a lender handle the added risk of the low down payment? The solution is Private Mortgage Insurance or PMI. PMI covers the lender in case a borrower doesn't pay on the loan and the market price of the home is less than what the borrower still owes on the loan. PMI can be costly to a borrower on the grounds that the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and generally isn't even tax deductible. Opposite from a piggyback loan where the lender consumes all the damages, PMI is profitable for the lender because they obtain the money, and they receive payment 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 a home buyer refrain from paying PMI?The Homeowners Protection Act of 1998 obligates the lenders on nearly all loans to automatically cancel the PMI when the principal balance of the loan equals 78 percent of the initial loan amount. The law designates that, at the request of the home owner, the PMI must be released when the principal amount reaches just 80 percent. So, smart home owners can get off the hook sooner than expected. Since it can take countless years to reach the point where the principal is only 20% of the initial amount borrowed, it's essential to know how your home has appreciated in value. After all, every bit of appreciation you've acquired over time counts towards dismissing PMI. So why pay it after your loan balance has fallen below the 80% threshold? Your neighborhood may not be adopting the national trends and/or your home may have gained equity before things settled down, so even when nationwide trends forecast declining home values, you should understand that real estate is local. An accredited, licensed real estate appraiser can help home owners understand just when their home's equity rises above the 20% point, as it's a tough thing to know. It's an appraiser's job to keep up with the market dynamics of their area. At Crowe Appraisals, we know when property values have risen or declined. We're experts at analyzing value trends in Oklahoma City, Oklahoma County and surrounding areas. When faced with information from an appraiser, the mortgage company will often cancel the PMI with little trouble. At which time, the homeowner can enjoy the savings from that point on.
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