Let Linneman Appraisals, LLC help you decide if you can eliminate your PMIA 20% down payment is typically the standard when buying a house. The lender's risk is often only the remainder between the home value and the amount remaining on the loan, so the 20% provides a nice buffer against the charges of foreclosure, selling the home again, and regular value fluctuations in the event a purchaser is unable to pay. The market was 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 handle the additional risk of the small down payment with Private Mortgage Insurance or PMI. PMI guards the lender in the event a borrower is unable to pay on the loan and the market price of the property is lower than the balance of the loan. Since the $40-$50 a month per $100,000 borrowed is bundled into the mortgage monthly payment and oftentimes isn't even tax deductible, PMI can be expensive to a borrower. It's lucrative for the lender because they secure the money, and they receive payment if the borrower defaults, separate 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 can a buyer avoid paying PMI?With the utilization of The Homeowners Protection Act of 1998, on most loans lenders are obligated to automatically cease the PMI when the principal balance of the loan reaches 78 percent of the primary loan amount. Savvy homeowners can get off the hook ahead of time. The law promises that, at the request of the home owner, the PMI must be released when the principal amount reaches only 80 percent. It can take countless years to reach the point where the principal is only 20% of the original amount borrowed, so it's important to know how your home has appreciated in value. After all, all of the appreciation you've achieved over the years counts towards abolishing PMI. So what's the reason for paying it after the balance of your loan has fallen below the 80% mark? Despite the fact that nationwide trends forecast falling home values, realize that real estate is local. Your neighborhood may not be heeding the national trends and/or your home may have gained equity before things calmed down. An accredited, licensed real estate appraiser can help home owners understand just when their home's equity goes over the 20% point, as it's a difficult thing to know. As appraisers, it's our job to understand the market dynamics of our area. At Linneman Appraisals, LLC, we know when property values have risen or declined. We're experts at determining value trends in Littleton, Jefferson County and surrounding areas. When faced with figures from an appraiser, the mortgage company will usually eliminate the PMI with little trouble. At which time, the homeowner can relish the savings from that point on.
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