Lyman Appraisal Services, LLC can help you remove your Private Mortgage InsuranceIt's widely understood that a 20% down payment is the standard when buying a house. The lender's risk is generally only the difference between the home value and the amount remaining on the loan, so the 20% supplies a nice buffer against the costs of foreclosure, selling the home again, and regular value changes on the chance that a purchaser doesn't pay. Lenders were accepting down payments as low as 10, 5 and even 0 percent during the mortgage boom of the last decade. How does a lender handle the added risk of the small down payment? The answer is Private Mortgage Insurance or PMI. PMI protects the lender in case a borrower is unable to pay on the loan and the worth of the home is less than the loan balance. PMI can be pricey to a borrower because the $40-$50 a month per $100,000 borrowed is compiled into the mortgage monthly payment and generally isn't even tax deductible. It's money-making for the lender because they secure the money, and they get the money if the borrower defaults, unlike a piggyback loan where the lender absorbs all the deficits. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How home buyers can keep from bearing the cost of PMIWith the employment of The Homeowners Protection Act of 1998, on most loans lenders are forced to automatically eliminate the PMI when the principal balance of the loan equals 78 percent of the beginning loan amount. Smart home owners can get off the hook a little early. The law promises that, upon request of the home owner, the PMI must be released when the principal amount reaches just 80 percent. Because it can take many years to reach the point where the principal is only 20% of the initial amount borrowed, it's necessary to know how your home has increased in value. After all, any appreciation you've gained over the years counts towards dismissing PMI. So what's the reason for paying it after the balance of your loan has dropped below the 80% threshold? Your neighborhood might not be following the national trends and/or your home might have acquired equity before things simmered down, so even when nationwide trends forecast plunging home values, you should understand that real estate is local. The difficult thing for many homeowners to understand is just when their home's equity goes over the 20% point. An accredited, licensed real estate appraiser can definitely help. It's an appraiser's job to keep up with the market dynamics of their area. At Lyman Appraisal Services, LLC, we know when property values have risen or declined. We're masters at identifying value trends in Cornelius, Lincoln County and surrounding areas. When faced with figures from an appraiser, the mortgage company will generally drop the PMI with little effort. At which time, the home owner can relish the savings from that point on.
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