Performance Appraisals Inc. can help you remove your Private Mortgage InsuranceA 20% down payment is usually the standard when getting a mortgage. Since the liability for the lender is often only the remainder between the home value and the sum remaining on the loan, the 20% adds a nice buffer against the expenses of foreclosure, reselling the home, and natural value changesin the event a purchaser is unable to pay. During the recent mortgage upturn of the last decade, it became widespread to see lenders requiring down payments of 10, 5 or even 0 percent. How does a lender manage the increased risk of the small down payment? The solution is Private Mortgage Insurance or PMI. This additional plan covers the lender if a borrower defaults on the loan and the value of the property is less 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 many times isn't even tax deductible, PMI can be pricey to a borrower. Contradictory to a piggyback loan where the lender absorbs all the losses, PMI is favorable for the lender because they collect the money, and they receive payment if the borrower doesn't pay. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can homebuyers refrain from paying PMI?With the implementation of The Homeowners Protection Act of 1998, on nearly all loans lenders are required to automatically cancel the PMI when the principal balance of the loan reaches 78 percent of the beginning loan amount. Keen home owners can get off the hook ahead of time. The law pledges that, upon request of the home owner, the PMI must be dropped when the principal amount equals just 80 percent. Since it can take many years to arrive at the point where the principal is just 20% of the initial amount of the loan, it's essential to know how your home has appreciated in value. After all, every bit of appreciation you've gained over the years 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 forecast plummeting home values, understand that real estate is local. Your neighborhood might not be heeding the national trends and/or your home could have acquired equity before things calmed down. The hardest thing for almost all home owners to know is just when their home's equity goes over the 20% point. An accredited, licensed real estate appraiser can definitely help. It is an appraiser's job to keep up with the market dynamics of their area. At Performance Appraisals Inc., we're masters at identifying value trends in Ponte Vedra Beach, Saint Johns County and surrounding areas, and we know when property values have risen or declined. When faced with information from an appraiser, the mortgage company will most often eliminate the PMI with little trouble. At that time, the homeowner can retain the savings from that point on.
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