Let AJB Appraisals help you discover if you can get rid of your PMIWhen buying a house, a 20% down payment is typically the standard. Considering the liability for the lender is generally only the remainder between the home value and the sum due on the loan, the 20% adds a nice buffer against the charges of foreclosure, reselling the home, and natural value changeson the chance that a purchaser doesn't pay. The market was accepting down payments as low as 10, 5 and often 0 percent in the peak of last decade's mortgage boom. How does a lender endure the increased risk of the small down payment? The solution is Private Mortgage Insurance or PMI. PMI protects the lender if a borrower defaults on the loan and the market price of the house is less than what the borrower still owes on the loan. Because the $40-$50 a month per $100,000 borrowed is bundled into the mortgage monthly payment and oftentimes isn't even tax deductible, PMI can be expensive to a borrower. It's beneficial for the lender because they collect the money, and they get paid if the borrower doesn't pay, opposite from a piggyback loan where the lender absorbs 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 a buyer refrain from bearing the cost of PMI?With the utilization of The Homeowners Protection Act of 1998, on most loans lenders are forced to automatically stop the PMI when the principal balance of the loan equals 78 percent of the original loan amount. Wise homeowners can get off the hook ahead of time. The law designates that, upon request of the homeowner, the PMI must be released when the principal amount reaches only 80 percent. Because it can take countless years to get to the point where the principal is just 20% of the initial amount of the loan, it's essential to know how your home has grown in value. After all, every bit of appreciation you've accomplished over time counts towards dismissing PMI. So what's the reason for paying it after the balance of your loan has dropped below the 80% mark? Even when nationwide trends hint at declining home values, realize that real estate is local. Your neighborhood may not be following the national trends and/or your home may have secured equity before things simmered down. An accredited, licensed real estate appraiser can help home owners understand just when their home's equity goes over the 20% point, as it's a difficult thing to know. As appraisers, it's our job to recognize the market dynamics of our area. At AJB Appraisals , we're masters at determining value trends in Surprise, Maricopa County and surrounding areas, and we know when property values have risen or declined. When faced with data from an appraiser, the mortgage company will usually eliminate the PMI with little trouble. At which time, the home owner can enjoy the savings from that point on.
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