Have equity in your home? Want a lower payment? An appraisal from Casa Grande Appraisal Service can help you get rid of your PMI.It's typically known that a 20% down payment is accepted when purchasing a home. The lender's liability is usually only the difference between the home value and the amount remaining on the loan, so the 20% adds a nice cushion against the costs of foreclosure, selling the home again, and regular value fluctuations on the chance that a purchaser doesn't pay. During the recent mortgage boom of the mid 2000s, it became common to see lenders commanding down payments of 10, 5 or sometimes 0 percent. A lender is able to handle the additional risk of the small down payment with Private Mortgage Insurance or PMI. This added policy guards the lender if a borrower doesn't pay on the loan and the value of the property is less than what is owed on the loan. PMI can be pricey to a borrower in 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 beneficial for the lender because they collect the money, and they get paid if the borrower doesn't pay, different from a piggyback loan where the lender takes in all the costs. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How home owners can keep from bearing the cost of PMIThe Homeowners Protection Act of 1998 obligates the lenders on most loans to automatically cease the PMI when the principal balance of the loan equals 78 percent of the original loan amount. The law promises that, at the request of the homeowner, the PMI must be dropped when the principal amount equals only 80 percent. So, acute home owners can get off the hook a little early. Because it can take countless years to get to the point where the principal is only 20% of the initial amount borrowed, it's necessary 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 the balance of your loan has dropped below the 80% threshold? Despite the fact that nationwide trends predict decreasing home values, be aware that real estate is local. Your neighborhood might not be reflecting the national trends and/or your home could have acquired equity before things settled down. The difficult thing for many homeowners to understand is just when their home's equity rises above the 20% point. An accredited, licensed real estate appraiser can surely help. It's an appraiser's job to understand the market dynamics of their area. At Casa Grande Appraisal Service, we're masters at identifying value trends in Tempe, Maricopa 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 remove the PMI with little anxiety. At that time, the homeowner can enjoy the savings from that point on.
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