Let Appraisal Quest Co. (805) 469-3088 help you figure out if you can cancel your PMIWhen getting a mortgage, a 20% down payment is typically the standard. The lender's liability is often only the remainder between the home value and the sum outstanding on the loan, so the 20% provides a nice cushion against the costs of foreclosure, selling the home again, and typical value variations on the chance that a purchaser doesn't pay. The market was accepting down payments as low as 10, 5 and even 0 percent during the mortgage boom of the mid 2000s. A lender is able to handle the added risk of the minimal down payment with Private Mortgage Insurance or PMI. PMI protects the lender in case a borrower doesn't pay on the loan and the market price of the property is less than the loan balance. Because the $40-$50 a month per $100,000 borrowed is rolled into the mortgage monthly payment and often isn't even tax deductible, PMI is costly to a borrower. It's lucrative for the lender because they secure the money, and they get paid if the borrower is unable to pay, different 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 home buyers can avoid paying PMIThe Homeowners Protection Act of 1998 requires the lenders on most loans to automatically cease the PMI when the principal balance of the loan reaches 78 percent of the initial loan amount. Savvy home owners can get off the hook sooner than expected. The law promises that, upon request of the home owner, the PMI must be released when the principal amount reaches only 80 percent. Because it can take many years to get to the point where the principal is just 20% of the initial loan amount, it's important to know how your home has appreciated in value. After all, every bit of appreciation you've obtained over time counts towards abolishing PMI. So what's the reason for paying it after your loan balance has fallen below the 80% threshold? Your neighborhood might not be heeding the national trends and/or your home may have secured equity before things calmed down, so even when nationwide trends forecast decreasing home values, you should realize that real estate is local. The toughest thing for almost all homeowners to know is just when their home's equity goes over the 20% point. A certified, licensed real estate appraiser can surely help. It's an appraiser's job to know the market dynamics of their area. At Appraisal Quest Co. (805) 469-3088, we're experts at identifying value trends in Ventura, Ventura County and surrounding areas, and we know when property values have risen or declined. When faced with figures from an appraiser, the mortgage company will usually drop the PMI with little effort. At which time, the home owner can relish the savings from that point on.
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