Performance Appraisals Inc. can help you remove your Private Mortgage InsuranceIt's generally understood that a 20% down payment is accepted when buying a house. The lender's liability is often only the remainder between the home value and the amount outstanding on the loan, so the 20% adds a nice cushion against the expenses of foreclosure, reselling the home, and regular value fluctuations in the event a purchaser defaults. The market was working with down payments as low as 10, 5 and often 0 percent in the peak of last decade's mortgage boom. A lender is able to handle the increased risk of the low down payment with Private Mortgage Insurance or PMI. PMI covers the lender in the event a borrower defaults on the loan and the value of the property is lower than the balance of the loan. Since the $40-$50 a month per $100,000 borrowed is bundled into the mortgage monthly payment and oftentimes 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 paid if the borrower defaults, separate from a piggyback loan where the lender consumes all the costs. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can a home owner prevent bearing the expense of PMI?With the implementation of The Homeowners Protection Act of 1998, on most loans lenders are required to automatically eliminate the PMI when the principal balance of the loan equals 78 percent of the primary loan amount. Savvy homeowners can get off the hook a little early. The law states that, upon request of the home owner, the PMI must be dropped when the principal amount reaches only 80 percent. It can take countless years to arrive at the point where the principal is just 20% of the original amount borrowed, so it's crucial to know how your home has increased in value. After all, all of the appreciation you've obtained over time counts towards removing PMI. So why pay it after the balance of your loan has dropped below the 80% mark? Despite the fact that nationwide trends predict declining home values, be aware that real estate is local. Your neighborhood might not be heeding the national trends and/or your home might have acquired equity before things simmered down. The difficult thing for most 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 is an appraiser's job to know the market dynamics of their area. At Performance Appraisals Inc., we know when property values have risen or declined. We're masters at analyzing value trends in Ponte Vedra Beach, Saint Johns County and surrounding areas. Faced with data from an appraiser, the mortgage company will usually remove the PMI with little trouble. At which time, the home owner can enjoy the savings from that point on.
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