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Robertson Appraisal Group can help you remove your Private Mortgage Insurance
When purchasing a home, a 20% down payment is typically the standard.
Because the risk for the lender is oftentimes only the difference between the home value and the amount due on the loan, the 20% provides a nice buffer against the costs of foreclosure, selling the home again, and typical value changes on the chance that a purchaser is unable to pay.
During the recent mortgage upturn that our country recently experienced, it became widespread to see lenders making deals with down payments of 10, 5 or even 0 percent.
How does a lender endure the increased risk of the low down payment? The solution is Private Mortgage Insurance or PMI.
This supplemental plan covers the lender in the event a borrower doesn't pay on the loan and the value of the home is less than the loan balance.
PMI can be expensive to a borrower on the grounds that the $40-$50 a month per $100,000 borrowed is lumped into the mortgage payment and frequently isn't even tax deductible.
Different from a piggyback loan where the lender consumes all the damages, PMI is advantageous for the lender because they obtain the money, and they get the money if the borrower is unable to pay.
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The savings from getting rid of your PMI will make up for the price of the appraisal in no time. Robertson Appraisal Group are experts when it comes to value trends in the city of Dallas and Dallas County. Contact us today.
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How can homeowners keep from paying PMI?
The Homeowners Protection Act of 1998 obligates the lenders on most loans to automatically cancel the PMI when the principal balance of the loan reaches 78 percent of the beginning loan amount.
The law pledges that, at the request of the homeowner, the PMI must be released when the principal amount reaches just 80 percent. So, smart homeowners can get off the hook ahead of time.
It can take many years to arrive at the point where the principal is only 80% of the initial loan amount, so it's important to know how your Texas home has increased in value.
After all, any appreciation you've acquired over time counts towards removing PMI. So why pay it after your loan balance has dropped below the 80% threshold?
Even when nationwide trends forecast decreasing home values, be aware that real estate is local. Your neighborhood might not be adhering to the national trends and/or your home may have secured equity before things declined.
The difficult thing for many consumers to determine is whether their home equity has exceeded the 20% point. A certified, Texas licensed real estate appraiser can surely help.
As appraisers, it's our job to understand the market dynamics of our area.
At Robertson Appraisal Group, we know when property values have risen or declined. We're masters at pinpointing value trends in Dallas, Dallas County, and surrounding areas.
Faced with data from an appraiser, the mortgage company will generally do away with the PMI with little trouble. At that time, the home owner can relish the savings from that point on.
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Did you secure your mortgage with less than 20% down? Call Robertson Appraisal Group today at 2146364972 to see if you can get rid of your Private Mortgage Insurance payment.
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Want to learn more about PMI and the Homeowners Protection Act? Click this link:
Cancellation of Private Mortgage Insurance: Federal Law May Save You Hundreds of Dollars Each Year
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