Let Accredited Appraisals help you decide if you can cancel your PMIA 20% down payment is usually the standard when purchasing a home. The lender's risk is usually only the difference between the home value and the sum remaining on the loan, so the 20% provides a nice buffer against the expenses of foreclosure, selling the home again, and natural value fluctuations on the chance that a purchaser defaults. Banks were accepting down payments down to 10, 5 and even 0 percent in the peak of last decade's mortgage boom. A lender is able to endure the increased risk of the low down payment with Private Mortgage Insurance or PMI. This additional policy takes care of the lender if a borrower doesn't pay on the loan and the market price of the house is lower than the balance of the loan. PMI can be pricey to a borrower in that the $40-$50 a month per $100,000 borrowed is compiled into the mortgage monthly payment and many times isn't even tax deductible. It's profitable for the lender because they obtain the money, and they get the money if the borrower doesn't pay, unlike 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 a buyer refrain from bearing the cost of PMI?The Homeowners Protection Act of 1998 forces the lenders on nearly all loans to automatically stop the PMI when the principal balance of the loan equals 78 percent of the initial loan amount. The law states that, upon request of the homeowner, the PMI must be abandoned when the principal amount reaches only 80 percent. So, smart home owners can get off the hook sooner than expected. It can take countless years to get to the point where the principal is just 20% of the initial loan amount, so it's necessary to know how your home has increased in value. After all, all of the appreciation you've acquired over the years counts towards removing PMI. So why should you pay it after your loan balance has dropped below the 80% mark? Even when nationwide trends forecast plummeting home values, realize that real estate is local. Your neighborhood might not be adhering to the national trends and/or your home might have gained equity before things calmed down. The toughest thing for most home owners to know is just when their home's equity rises above the 20% point. An accredited, licensed real estate appraiser can definitely help. As appraisers, it's our job to know the market dynamics of our area. At Accredited Appraisals, we're masters at recognizing value trends in Evergreen Park, Cook County and surrounding areas, and we know when property values have risen or declined. Faced with figures from an appraiser, the mortgage company will generally drop the PMI with little anxiety. At that time, the home owner can delight in the savings from that point on.
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