Let Crowe Appraisals help you decide if you can eliminate your PMIWhen buying a house, a 20% down payment is usually the standard. The lender's liability is oftentimes only the difference between the home value and the amount due on the loan, so the 20% supplies a nice cushion against the charges of foreclosure, selling the home again, and regular value fluctuations in the event a purchaser doesn't pay. The market was working with down payments as low as 10, 5 and often 0 percent during the mortgage boom of the last decade. A lender is able to handle the additional risk of the reduced down payment with Private Mortgage Insurance or PMI. PMI covers the lender in case a borrower is unable to pay on the loan and the market price of the house is less than the loan balance. Since the $40-$50 a month per $100,000 borrowed is rolled into the mortgage payment and generally isn't even tax deductible, PMI can be costly to a borrower. Separate from a piggyback loan where the lender takes in all the losses, PMI is lucrative for the lender because they acquire 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 can a home buyer keep from bearing the cost of PMI?With the employment of The Homeowners Protection Act of 1998, on nearly all loans lenders are forced to automatically cancel the PMI when the principal balance of the loan reaches 78 percent of the original loan amount. Savvy homeowners can get off the hook ahead of time. The law states that, upon 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 arrive at the point where the principal is just 20% of the original amount of the loan, it's essential to know how your home has grown in value. After all, every bit of appreciation you've gained over time counts towards dismissing PMI. So why should you pay it after your loan balance has dropped below the 80% mark? Your neighborhood might not be reflecting the national trends and/or your home could have gained equity before things cooled off, so even when nationwide trends forecast plummeting home values, you should understand that real estate is local. A certified, licensed real estate appraiser can help homeowners 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 know the market dynamics of their area. At Crowe Appraisals, we know when property values have risen or declined. We're experts at pinpointing value trends in Oklahoma City, Oklahoma County and surrounding areas. Faced with information from an appraiser, the mortgage company will generally eliminate the PMI with little anxiety. At which time, the homeowner can enjoy the savings from that point on.
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