Solidrock Appraisal can help you remove your Private Mortgage InsuranceA 20% down payment is typically accepted when purchasing a home. Because the risk for the lender is often only the difference between the home value and the sum due on the loan, the 20% supplies a nice cushion against the expenses of foreclosure, selling the home again, and regular value changesin the event a borrower doesn't pay. During the recent mortgage upturn of the mid 2000s, it was common to see lenders requiring down payments of 10, 5 or often 0 percent. How does a lender handle the added risk of the small down payment? The answer is Private Mortgage Insurance or PMI. PMI guards the lender in case a borrower doesn't pay on the loan and the value of the property is lower than what is owed on the loan. Because the $40-$50 a month per $100,000 borrowed is bundled into the mortgage payment and many times isn't even tax deductible, PMI can be costly to a borrower. Unlike a piggyback loan where the lender takes in all the costs, PMI is advantageous for the lender because they collect the money, and they get the money 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 buyers prevent paying PMI?With the employment of The Homeowners Protection Act of 1998, on most loans lenders are forced to automatically eliminate the PMI when the principal balance of the loan reaches 78 percent of the initial loan amount. Acute homeowners can get off the hook ahead of time. The law designates that, upon request of the home owner, the PMI must be dropped when the principal amount reaches just 80 percent. It can take many years to reach the point where the principal is just 20% of the original amount of the loan, so it's essential to know how your home has increased 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 dropped below the 80% mark? Your neighborhood might not be minding the national trends and/or your home could have acquired equity before things calmed down, 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 homeowners understand just when their home's equity rises above the 20% point, as it's a hard thing to know. It's an appraiser's job to keep up with the market dynamics of their area. At Solidrock Appraisal, we're experts at identifying value trends in Battle Ground, Clark County and surrounding areas, and we know when property values have risen or declined. Faced with information from an appraiser, the mortgage company will generally cancel the PMI with little anxiety. At which time, the home owner can retain the savings from that point on.
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