MG Appraisal Services can help you remove your Private Mortgage InsuranceIt's typically understood that a 20% down payment is accepted when buying a house. Considering the liability for the lender is generally only the difference between the home value and the amount remaining on the loan, the 20% provides a nice cushion against the expenses of foreclosure, reselling the home, and regular value variationsin the event a purchaser is unable to pay. During the recent mortgage boom of the last decade, it became common to see lenders taking down payments of 10, 5 or even 0 percent. How does a lender handle the added risk of the small down payment? The solution is Private Mortgage Insurance or PMI. This additional policy covers the lender if a borrower is unable to pay on the loan and the market price of the home is less 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 lumped into the mortgage monthly payment and oftentimes isn't even tax deductible. Contradictory to a piggyback loan where the lender absorbs all the damages, PMI is beneficial for the lender because they obtain the money, and they get paid if the borrower doesn't pay. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can home buyers keep from paying PMI?With the utilization of The Homeowners Protection Act of 1998, on nearly all loans lenders are obligated to automatically stop the PMI when the principal balance of the loan reaches 78 percent of the original loan amount. Savvy homeowners can get off the hook beforehand. The law states that, upon request of the home owner, the PMI must be dropped when the principal amount reaches just 80 percent. Considering it can take countless years to reach the point where the principal is just 20% of the original loan amount, it's important to know how your home has grown in value. After all, all of the appreciation you've accomplished over time counts towards dismissing PMI. So why should you pay it after the balance of your loan has dropped below the 80% mark? Your neighborhood may not be following the national trends and/or your home may have secured equity before things calmed down, so even when nationwide trends signify decreasing home values, you should realize 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 hard thing to know. As appraisers, it's our job to understand the market dynamics of our area. At MG Appraisal Services, we're experts at analyzing value trends in Rochester, Monroe County and surrounding areas, and we know when property values have risen or declined. Faced with data from an appraiser, the mortgage company will often cancel the PMI with little effort. At which time, the homeowner can enjoy the savings from that point on.
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