Let Acute Dimensions, LLC help you learn if you can get rid of your PMIWhen purchasing a home, a 20% down payment is typically the standard. The lender's liability is often only the remainder between the home value and the amount due on the loan, so the 20% adds a nice buffer against the costs of foreclosure, reselling the home, and natural value fluctuations in the event a purchaser doesn't pay. During the recent mortgage upturn of the last decade, it became common to see lenders requiring down payments of 10, 5 or sometimes 0 percent. How does a lender endure the increased risk of the small down payment? The answer is Private Mortgage Insurance or PMI. This supplementary plan protects the lender in the event a borrower doesn't pay on the loan and the market price of the property is lower than what the borrower still owes on the loan. Because the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and generally isn't even tax deductible, PMI can be costly to a borrower. Contradictory to a piggyback loan where the lender consumes all the costs, PMI is lucrative for the lender because they obtain the money, and they receive payment 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 buyers refrain from bearing the expense of PMI?The Homeowners Protection Act of 1998 requires the lenders on most loans to automatically terminate the PMI when the principal balance of the loan equals 78 percent of the primary loan amount. The law states that, at the request of the homeowner, the PMI must be released when the principal amount equals just 80 percent. So, wise homeowners can get off the hook ahead of time. Considering it can take countless years to get to the point where the principal is just 20% of the original loan amount, it's necessary to know how your home has appreciated in value. After all, any appreciation you've acquired over the years counts towards dismissing PMI. So why pay it after the balance of your loan has dropped below the 80% mark? Your neighborhood might not be reflecting the national trends and/or your home could have gained equity before things cooled off, so even when nationwide trends hint at decreasing 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 rises above the 20% point, as it's a tough thing to know. It is an appraiser's job to keep up with the market dynamics of their area. At Acute Dimensions, LLC, we're experts at pinpointing value trends in Chandler, Maricopa County and surrounding areas, and we know when property values have risen or declined. Faced with data from an appraiser, the mortgage company will generally eliminate the PMI with little anxiety. At which time, the home owner can enjoy the savings from that point on.
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