Let Denver Appraisal Consultants, LLC help you figure out if you can eliminate your PMIWhen buying a house, a 20% down payment is typically the standard. The lender's risk is oftentimes only the remainder between the home value and the sum remaining on the loan, so the 20% provides a nice cushion against the costs of foreclosure, reselling the home, and natural value fluctuations on the chance that a purchaser doesn't pay. Lenders were working with down payments down to 10, 5 and often 0 percent in the peak of last decade's mortgage boom. A lender is able to manage the additional risk of the reduced down payment with Private Mortgage Insurance or PMI. This supplementary policy protects the lender in case a borrower defaults on the loan and the value of the house is lower than what the borrower still owes on the loan. Because the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and oftentimes isn't even tax deductible, PMI is pricey to a borrower. It's money-making for the lender because they secure the money, and they get the money if the borrower defaults, opposite from a piggyback loan where the lender absorbs 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 prevent paying PMIWith the utilization of The Homeowners Protection Act of 1998, on most loans lenders are obligated to automatically eliminate the PMI when the principal balance of the loan equals 78 percent of the initial loan amount. The law pledges that, at the request of the home owner, the PMI must be abandoned when the principal amount reaches only 80 percent. So, acute homeowners can get off the hook sooner than expected. Considering it can take many years to arrive at the point where the principal is just 20% of the original amount borrowed, it's important to know how your home has increased in value. After all, every bit of appreciation you've gained over time counts towards removing PMI. So why pay it after your loan balance has dropped below the 80% mark? Your neighborhood may not be minding the national trends and/or your home could have gained equity before things cooled off, so even when nationwide trends indicate declining home values, you should understand that real estate is local. The toughest 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 definitely help. As appraisers, it's our job to keep up with the market dynamics of our area. At Denver Appraisal Consultants, LLC, we know when property values have risen or declined. We're masters at pinpointing value trends in Denver, Denver County and surrounding areas. When faced with data from an appraiser, the mortgage company will usually eliminate the PMI with little effort. At which time, the home owner can enjoy the savings from that point on.
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