Let Breedlove Appraisals, Inc. help you figure out if you can get rid of your PMIIt's generally known that a 20% down payment is common when buying a house. Considering the risk for the lender is oftentimes only the difference between the home value and the amount remaining on the loan, the 20% provides a nice buffer against the costs of foreclosure, selling the home again, and regular value changesin the event a purchaser doesn't pay. During the recent mortgage upturn of the last decade, it was customary to see lenders commanding down payments of 10, 5 or even 0 percent. How does a lender handle the added risk of the low down payment? The answer is Private Mortgage Insurance or PMI. PMI protects the lender if a borrower doesn't pay on the loan and the value of the home is lower than what is owed on the loan. PMI can be pricey to a borrower in that the $40-$50 a month per $100,000 borrowed is lumped into the mortgage payment and generally isn't even tax deductible. It's advantageous for the lender because they collect the money, and they get the money if the borrower doesn't pay, opposite from a piggyback loan where the lender takes in all the damages. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How buyers can keep from bearing the expense of PMIThe Homeowners Protection Act of 1998 makes the lenders on nearly all loans to automatically cancel the PMI when the principal balance of the loan equals 78 percent of the primary loan amount. Smart home owners can get off the hook ahead of time. The law designates that, at the request of the home owner, the PMI must be released when the principal amount equals just 80 percent. Since it can take many years to get to the point where the principal is only 20% of the initial loan amount, it's important to know how your home has increased in value. After all, any appreciation you've accomplished over the years counts towards abolishing PMI. So what's the reason for paying it after the balance of your loan has fallen below the 80% mark? Even when nationwide trends signify decreasing home values, be aware that real estate is local. Your neighborhood may not be adhering to the national trends and/or your home may have secured equity before things settled down. The toughest thing for many homeowners to know is just when their home's equity rises above the 20% point. A certified, licensed real estate appraiser can certainly help. As appraisers, it's our job to understand the market dynamics of our area. At Breedlove Appraisals, Inc., we know when property values have risen or declined. We're experts at recognizing value trends in Athens, Oconee County and surrounding areas. Faced with data from an appraiser, the mortgage company will usually remove the PMI with little effort. At that time, the homeowner can retain the savings from that point on.
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