Have equity in your home? Want a lower payment? An appraisal from Martin Appraisal Co. can help you get rid of your PMI.A 20% down payment is typically the standard when buying a house. Because the risk for the lender is usually only the remainder between the home value and the sum remaining on the loan, the 20% provides a nice cushion against the expenses of foreclosure, reselling the home, and regular value changeson the chance that a borrower is unable to pay. During the recent mortgage upturn of the mid 2000s, it was common to see lenders commanding down payments of 10, 5 or sometimes 0 percent. A lender is able to handle the additional risk of the small down payment with Private Mortgage Insurance or PMI. This supplementary plan protects the lender in the event a borrower is unable to pay on the loan and the value of the house is lower than what is owed on the loan. Because the $40-$50 a month per $100,000 borrowed is rolled into the mortgage monthly payment and generally isn't even tax deductible, PMI can be pricey to a borrower. It's favorable for the lender because they acquire the money, and they get the money if the borrower defaults, different from 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 home buyers can refrain from bearing the cost of PMIThe Homeowners Protection Act of 1998 obligates the lenders on most loans to automatically cancel the PMI when the principal balance of the loan reaches 78 percent of the original loan amount. The law stipulates that, upon request of the homeowner, the PMI must be released when the principal amount equals only 80 percent. So, savvy home owners can get off the hook a little earlier. It can take many years to get to the point where the principal is just 20% of the original loan amount, so it's necessary to know how your home has grown in value. After all, every bit of appreciation you've accomplished over the years counts towards dismissing PMI. So why pay it after your loan balance has fallen below the 80% mark? Your neighborhood might not be heeding the national trends and/or your home could have acquired equity before things simmered down, so even when nationwide trends hint at falling home values, you should understand that real estate is local. The toughest thing for almost all home owners to understand is just when their home's equity rises above the 20% point. A certified, licensed real estate appraiser can certainly help. It's an appraiser's job to know the market dynamics of their area. At Martin Appraisal Co., we're masters at analyzing value trends in Eugene, Lane 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 drop the PMI with little anxiety. At which time, the homeowner can enjoy the savings from that point on.
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