Maestri Realty Appraisals can help you remove your Private Mortgage InsuranceA 20% down payment is typically the standard when buying a house. The lender's liability is often only the difference between the home value and the sum remaining on the loan, so the 20% provides a nice cushion against the charges of foreclosure, selling the home again, and typical value changes in the event a purchaser doesn't pay. During the recent mortgage upturn of the mid 2000s, it was common to see lenders taking down payments of 10, 5 or sometimes 0 percent. How does a lender handle the added risk of the low down payment? The answer is Private Mortgage Insurance or PMI. This additional plan guards the lender in case a borrower doesn't pay on the loan and the value of the house is less than the loan balance. Because the $40-$50 a month per $100,000 borrowed is bundled into the mortgage monthly payment and often isn't even tax deductible, PMI is costly to a borrower. It's advantageous for the lender because they obtain the money, and they get the money if the borrower is unable to pay, separate from a piggyback loan where the lender takes in 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 homebuyers keep from paying PMI?The Homeowners Protection Act of 1998 requires the lenders on most loans to automatically eliminate the PMI when the principal balance of the loan equals 78 percent of the initial loan amount. The law pledges that, upon request of the home owner, the PMI must be dropped when the principal amount equals just 80 percent. So, wise homeowners can get off the hook ahead of time. It can take many years to arrive at the point where the principal is only 20% of the original loan amount, so it's crucial to know how your home has appreciated in value. After all, any appreciation you've achieved over the years counts towards abolishing PMI. So why pay it after your loan balance has fallen below the 80% threshold? Despite the fact that nationwide trends predict decreasing home values, understand that real estate is local. Your neighborhood might not be reflecting the national trends and/or your home could have secured 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 hard thing to know. As appraisers, it's our job to recognize the market dynamics of our area. At Maestri Realty Appraisals, we're masters at determining value trends in River Ridge, Jefferson County and surrounding areas, and we know when property values have risen or declined. Faced with data from an appraiser, the mortgage company will generally remove the PMI with little trouble. At which time, the homeowner can delight in the savings from that point on.
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