Let Cold Spring Appraisals, LLC help you decide if you can get rid of your PMIA 20% down payment is typically accepted when getting a mortgage. The lender's liability is oftentimes only the difference between the home value and the sum outstanding on the loan, so the 20% adds a nice buffer against the costs of foreclosure, reselling the home, and natural value changes on the chance that a borrower defaults. During the recent mortgage upturn of the last decade, it was widespread to see lenders requiring down payments of 10, 5 or sometimes 0 percent. A lender is able to endure the increased risk of the reduced down payment with Private Mortgage Insurance or PMI. This additional plan guards the lender if a borrower is unable to pay on the loan and the market price of the house is lower than what is owed on the loan. Because the $40-$50 a month per $100,000 borrowed is compiled into the mortgage monthly payment and generally isn't even tax deductible, PMI can be pricey to a borrower. Contradictory to a piggyback loan where the lender absorbs all the deficits, PMI is money-making for the lender because they secure the money, and they receive payment if the borrower defaults. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can home owners keep from paying PMI?The Homeowners Protection Act of 1998 forces the lenders on nearly all loans to automatically cease the PMI when the principal balance of the loan equals 78 percent of the beginning loan amount. Acute home owners can get off the hook a little earlier. The law promises that, at the request of the home owner, the PMI must be abandoned when the principal amount equals just 80 percent. It can take many years to get to the point where the principal is just 20% of the original amount borrowed, so it's essential to know how your home has appreciated in value. After all, any appreciation you've obtained over time counts towards abolishing PMI. So why pay it after your loan balance has fallen below the 80% mark? Your neighborhood may not be following the national trends and/or your home might have secured equity before things cooled off, so even when nationwide trends indicate declining home values, you should realize that real estate is local. A certified, licensed real estate appraiser can help home owners understand just when their home's equity goes over the 20% point, as it's a hard thing to know. As appraisers, it's our job to know the market dynamics of our area. At Cold Spring Appraisals, LLC, we know when property values have risen or declined. We're experts at analyzing value trends in Katy, Harris County and surrounding areas. Faced with figures from an appraiser, the mortgage company will most often drop the PMI with little effort. At that time, the homeowner can relish the savings from that point on.
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