Have equity in your home? Want a lower payment? An appraisal from Precise Home Appraisals, LLC can help you get rid of your PMI.It's largely inferred that a 20% down payment is common when purchasing a home. The lender's risk is oftentimes only the remainder between the home value and the amount due on the loan, so the 20% supplies a nice buffer against the costs of foreclosure, selling the home again, and typical value variations in the event a purchaser defaults. During the recent mortgage upturn of the mid 2000s, it was common to see lenders requiring down payments of 10, 5 or even 0 percent. How does a lender handle the added risk of the small down payment? The solution is Private Mortgage Insurance or PMI. This supplemental policy protects the lender in the event a borrower defaults on the loan and the market price of the property is lower than the loan balance. Because the $40-$50 a month per $100,000 borrowed is compiled into the mortgage monthly payment and often isn't even tax deductible, PMI can be expensive to a borrower. It's advantageous for the lender because they secure the money, and they receive payment if the borrower doesn't pay, separate from a piggyback loan where the lender consumes all the losses. 
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 paying PMI?The Homeowners Protection Act of 1998 makes the lenders on nearly all loans to automatically cancel the PMI when the principal balance of the loan equals 78 percent of the initial loan amount. Keen homeowners can get off the hook sooner than expected. The law promises that, upon request of the home owner, the PMI must be dropped when the principal amount equals only 80 percent. It can take many years to reach the point where the principal is only 20% of the initial amount of the loan, so it's crucial to know how your home has appreciated in value. After all, any appreciation you've achieved over time counts towards dismissing PMI. So what's the reason for paying it after your loan balance has dropped below the 80% mark? Even when nationwide trends forecast declining home values, understand that real estate is local. Your neighborhood might not be adhering to the national trends and/or your home could have acquired equity before things settled down. The hardest thing for many 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's an appraiser's job to keep up with the market dynamics of their area. At Precise Home Appraisals, LLC, we know when property values have risen or declined. We're experts at identifying value trends in Mesa, Maricopa County and surrounding areas. Faced with figures from an appraiser, the mortgage company will usually eliminate the PMI with little trouble. At that time, the homeowner can retain the savings from that point on.
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