Have equity in your home? Want a lower payment? An appraisal from Accurate Appraisals of KC can help you get rid of your PMI.It's typically understood that a 20% down payment is common when getting a mortgage. The lender's risk is often only the difference between the home value and the sum due on the loan, so the 20% provides a nice buffer against the costs of foreclosure, selling the home again, and regular value variations on the chance that a purchaser defaults. During the recent mortgage boom of the last decade, it became common to see lenders commanding down payments of 10, 5 or even 0 percent. A lender is able to manage the added risk of the low down payment with Private Mortgage Insurance or PMI. PMI protects the lender if a borrower is unable to pay on the loan and the value of the property is lower than what is owed on the loan. Since the $40-$50 a month per $100,000 borrowed is compiled into the mortgage payment and oftentimes isn't even tax deductible, PMI can be costly to a borrower. Unlike a piggyback loan where the lender takes in all the deficits, PMI is profitable for the lender because they obtain the money, and they get the money if the borrower is unable to pay. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can homeowners prevent paying PMI?The Homeowners Protection Act of 1998 requires the lenders on nearly all loans to automatically terminate the PMI when the principal balance of the loan equals 78 percent of the primary loan amount. Acute home owners can get off the hook a little earlier. The law promises that, upon request of the homeowner, the PMI must be dropped when the principal amount reaches only 80 percent. It can take many years to reach the point where the principal is only 20% of the original loan amount, so it's necessary to know how your home has grown in value. After all, every bit of appreciation you've gained 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% threshold? Your neighborhood might not be adopting the national trends and/or your home might have acquired equity before things settled down, so even when nationwide trends signify plunging home values, you should realize that real estate is local. An accredited, licensed real estate appraiser can help homeowners 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 recognize the market dynamics of our area. At Accurate Appraisals of KC, we know when property values have risen or declined. We're masters at recognizing value trends in Shawnee, Johnson County and surrounding areas. Faced with figures from an appraiser, the mortgage company will generally do away with the PMI with little anxiety. At which time, the homeowner can delight in the savings from that point on.
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