Let Columbus Appraisal Company, LLC help you learn if you can eliminate your PMIWhen getting a mortgage, a 20% down payment is usually the standard. Considering the risk for the lender is often only the difference between the home value and the sum outstanding on the loan, the 20% adds a nice cushion against the expenses of foreclosure, reselling the home, and typical value fluctuationsin the event a purchaser is unable to pay. During the recent mortgage boom of the last decade, it was customary to see lenders requiring down payments of 10, 5 or often 0 percent. How does a lender handle the increased risk of the small down payment? The answer is Private Mortgage Insurance or PMI. This added plan protects the lender in the event a borrower defaults on the loan and the value of the house is lower than the balance of 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 many times isn't even tax deductible. Opposite from a piggyback loan where the lender takes in all the costs, PMI is money-making 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 buyers keep from bearing the cost of PMI?With the utilization of The Homeowners Protection Act of 1998, on most loans lenders are forced to automatically cease the PMI when the principal balance of the loan reaches 78 percent of the beginning loan amount. Savvy home owners can get off the hook sooner than expected. The law states that, at the request of the home owner, the PMI must be released when the principal amount reaches just 80 percent. It can take many years to get to the point where the principal is just 20% of the initial loan amount, so it's necessary to know how your home has increased in value. After all, any 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? Even when nationwide trends forecast declining home values, realize that real estate is local. Your neighborhood may not be heeding the national trends and/or your home might have acquired equity before things settled down. An accredited, licensed real estate appraiser can help homeowners understand just when their home's equity rises above the 20% point, as it's a difficult thing to know. It is an appraiser's job to understand the market dynamics of their area. At Columbus Appraisal Company, LLC, we're masters at determining value trends in Columbus, Franklin County and surrounding areas, and we know when property values have risen or declined. When faced with information from an appraiser, the mortgage company will often remove the PMI with little effort. At that time, the homeowner can relish the savings from that point on.
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