Columbus Appraisal Company, LLC can help you remove your Private Mortgage InsuranceWhen buying a house, a 20% down payment is typically the standard. The lender's liability is often only the difference between the home value and the amount remaining on the loan, so the 20% adds a nice cushion against the costs of foreclosure, selling the home again, and typical value variations in the event a borrower defaults. During the recent mortgage upturn of the last decade, it was customary to see lenders requiring down payments of 10, 5 or sometimes 0 percent. How does a lender manage the increased risk of the small down payment? The answer is Private Mortgage Insurance or PMI. PMI takes care of the lender if a borrower is unable to pay on the loan and the value of the house is lower than what the borrower still owes on the loan. PMI is pricey to a borrower because the $40-$50 a month per $100,000 borrowed is compiled into the mortgage monthly payment and frequently isn't even tax deductible. It's profitable for the lender because they collect the money, and they get paid if the borrower doesn't pay, contradictory to a piggyback loan where the lender consumes all the deficits. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can homebuyers avoid bearing the cost of PMI?The Homeowners Protection Act of 1998 makes the lenders on nearly all loans to automatically cancel the PMI when the principal balance of the loan reaches 78 percent of the beginning loan amount. The law pledges that, at the request of the home owner, the PMI must be abandoned when the principal amount reaches only 80 percent. So, acute home owners can get off the hook ahead of time. It can take many years to reach the point where the principal is only 20% of the initial loan amount, so it's essential to know how your home has appreciated in value. After all, every bit of appreciation you've obtained over the years counts towards removing PMI. So why should you pay it after the balance of your loan has dropped below the 80% mark? Even when nationwide trends signify falling home values, understand that real estate is local. Your neighborhood might not be heeding the national trends and/or your home could have gained equity before things settled down. A certified, licensed real estate appraiser can help homeowners 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 keep up with the market dynamics of our area. At Columbus Appraisal Company, LLC, we know when property values have risen or declined. We're experts at analyzing value trends in Columbus, Franklin County and surrounding areas. Faced with figures from an appraiser, the mortgage company will often cancel the PMI with little anxiety. At that time, the home owner can relish the savings from that point on.
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