Have equity in your home? Want a lower payment? An appraisal from Reitzler Appraisal Services can help you get rid of your PMI.It's typically known that a 20% down payment is common when purchasing a home. Because the liability for the lender is often only the difference between the home value and the sum remaining on the loan, the 20% provides a nice cushion against the expenses of foreclosure, selling the home again, and natural value changeson the chance that a purchaser is unable to pay. During the recent mortgage boom of the mid 2000s, it became common to see lenders taking down payments of 10, 5 or even 0 percent. A lender is able to handle the added risk of the low down payment with Private Mortgage Insurance or PMI. PMI takes care of the lender in the event a borrower defaults on the loan and the value of the home is lower than the balance of 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 is pricey to a borrower. It's lucrative for the lender because they collect the money, and they get the money if the borrower doesn't pay, separate from a piggyback loan where the lender takes in all the costs. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How homeowners can prevent bearing the expense of PMIThe Homeowners Protection Act of 1998 obligates the lenders on most loans to automatically stop the PMI when the principal balance of the loan equals 78 percent of the beginning loan amount. The law promises that, at the request of the homeowner, the PMI must be released when the principal amount equals only 80 percent. So, smart homeowners can get off the hook a little earlier. Since it can take countless years to get to the point where the principal is only 20% of the original loan amount, it's essential to know how your home has grown in value. After all, every bit of appreciation you've acquired over time counts towards dismissing PMI. So why pay it after your loan balance has fallen below the 80% mark? Despite the fact that nationwide trends signify falling home values, understand that real estate is local. Your neighborhood might not be adhering to the national trends and/or your home might have gained equity before things settled down. The difficult thing for almost all homeowners to know is just when their home's equity goes over the 20% point. A certified, licensed real estate appraiser can certainly help. As appraisers, it's our job to know the market dynamics of our area. At Reitzler Appraisal Services, we're masters at identifying value trends in Richmond, Wayne County and surrounding areas, and we know when property values have risen or declined. Faced with data from an appraiser, the mortgage company will most often drop the PMI with little effort. At that time, the homeowner can delight in the savings from that point on.
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