Let Cotrill Realty Group help you learn if you can eliminate your PMIA 20% down payment is usually the standard when purchasing a home. The lender's risk is generally only the remainder between the home value and the amount due on the loan, so the 20% provides a nice buffer against the costs of foreclosure, selling the home again, and typical value fluctuations on the chance that a purchaser defaults. During the recent mortgage boom of the last decade, it became customary to see lenders taking down payments of 10, 5 or often 0 percent. A lender is able to endure the additional risk of the minimal down payment with Private Mortgage Insurance or PMI. This supplementary plan protects the lender in case a borrower defaults on the loan and the market price of the home is lower than what the borrower still owes on the loan. Since the $40-$50 a month per $100,000 borrowed is lumped into the mortgage payment and many times isn't even tax deductible, PMI can be costly to a borrower. It's lucrative 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 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 homeowners can refrain from bearing the cost of 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 equals 78 percent of the beginning loan amount. The law stipulates that, upon request of the homeowner, the PMI must be released when the principal amount reaches just 80 percent. So, savvy home owners can get off the hook a little early. Considering it can take countless years to reach the point where the principal is just 20% of the original loan amount, it's crucial to know how your home has appreciated in value. After all, every bit of appreciation you've achieved over time counts towards abolishing 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 gained equity before things calmed 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 know is just when their home's equity goes over the 20% point. An accredited, licensed real estate appraiser can surely help. It's an appraiser's job to understand the market dynamics of their area. At Cotrill Realty Group, we know when property values have risen or declined. We're masters at identifying value trends in Broken Arrow, Wagoner County and surrounding areas. When faced with figures from an appraiser, the mortgage company will most often eliminate the PMI with little anxiety. At which time, the home owner can retain the savings from that point on.
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