Let Tight & Right Real Estate Valuation help you learn if you can get rid of your PMIIt's largely inferred that a 20% down payment is the standard when purchasing a home. The lender's liability is often only the remainder between the home value and the amount outstanding on the loan, so the 20% provides a nice cushion against the expenses of foreclosure, reselling the home, and regular value fluctuations on the chance that a purchaser is unable to pay. Banks were taking down payments down to 10, 5 and even 0 percent during the mortgage boom of the mid 2000s. A lender is able to handle the increased risk of the reduced down payment with Private Mortgage Insurance or PMI. PMI protects the lender in the event a borrower defaults on the loan and the value of the house is less than what is owed on the loan. PMI can be pricey to a borrower on the grounds that the $40-$50 a month per $100,000 borrowed is rolled into the mortgage payment and many times isn't even tax deductible. It's beneficial for the lender because they acquire the money, and they get paid if the borrower defaults, contradictory to a piggyback loan where the lender consumes all the losses. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How home owners can avoid paying PMIWith the implementation 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 primary loan amount. The law guarantees that, at the request of the homeowner, the PMI must be abandoned when the principal amount reaches only 80 percent. So, keen homeowners can get off the hook sooner than expected. It can take countless years to get to the point where the principal is only 20% of the original amount of the loan, so it's essential to know how your home has increased in value. After all, any appreciation you've gained over the years counts towards dismissing PMI. So why pay it after the balance of your loan has fallen below the 80% threshold? Your neighborhood might not be heeding the national trends and/or your home might have acquired equity before things simmered down, so even when nationwide trends forecast falling home values, you should realize that real estate is local. A certified, licensed real estate appraiser can help home owners understand just when their home's equity goes over the 20% point, as it's a hard thing to know. It's an appraiser's job to understand the market dynamics of their area. At Tight & Right Real Estate Valuation, we know when property values have risen or declined. We're experts at determining value trends in Princeton, Union County and surrounding areas. When faced with information from an appraiser, the mortgage company will generally cancel the PMI with little effort. At which time, the home owner can relish the savings from that point on.
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