Have equity in your home? Want a lower payment? An appraisal from Medina Appraisal Company can help you get rid of your PMI.It's typically known that a 20% down payment is the standard when purchasing a home. Because the risk for the lender is usually only the remainder between the home value and the sum outstanding on the loan, the 20% supplies a nice cushion against the costs of foreclosure, reselling the home, and regular value variationsin the event a purchaser doesn't pay. During the recent mortgage boom of the last decade, it became widespread to see lenders requiring down payments of 10, 5 or often 0 percent. How does a lender handle the additional risk of the low down payment? The answer is Private Mortgage Insurance or PMI. PMI takes care of the lender in case a borrower doesn't pay on the loan and the value of the house is lower than what the borrower still owes on the loan. PMI is costly to a borrower on the grounds that the $40-$50 a month per $100,000 borrowed is bundled into the mortgage payment and generally isn't even tax deductible. It's favorable for the lender because they secure the money, and they get the money if the borrower defaults, contradictory to a piggyback loan where the lender absorbs all the costs. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can homebuyers keep from bearing the expense of PMI?The Homeowners Protection Act of 1998 requires the lenders on nearly all loans to automatically cancel the PMI when the principal balance of the loan equals 78 percent of the beginning loan amount. Smart homeowners can get off the hook a little earlier. The law designates that, at the request of the homeowner, the PMI must be released when the principal amount equals just 80 percent. It can take many years to arrive at the point where the principal is only 20% of the initial amount of the loan, so it's essential to know how your home has appreciated in value. After all, every bit of appreciation you've achieved over the years counts towards removing PMI. So what's the reason for paying it after the balance of your loan has fallen below the 80% mark? Even when nationwide trends hint at falling home values, realize that real estate is local. Your neighborhood might not be following the national trends and/or your home may have secured equity before things cooled off. The hardest thing for almost all homeowners to know is just when their home's equity rises above the 20% point. An accredited, licensed real estate appraiser can surely help. As appraisers, it's our job to understand the market dynamics of our area. At Medina Appraisal Company, we're experts at identifying value trends in Brunswick, OH, Medina 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 often do away with the PMI with little trouble. At that time, the home owner can enjoy the savings from that point on.
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