Felicia Sauder & Associates, Inc. can help you remove your Private Mortgage InsuranceIt's widely understood that a 20% down payment is the standard when getting a mortgage. The lender's risk is generally only the remainder between the home value and the sum due on the loan, so the 20% supplies a nice cushion against the charges of foreclosure, selling the home again, and typical value changes on the chance that a purchaser is unable to pay. The market was taking down payments down to 10, 5 and often 0 percent in the peak of last decade's mortgage boom. A lender is able to endure the additional risk of the reduced down payment with Private Mortgage Insurance or PMI. PMI covers the lender if a borrower doesn't pay on the loan and the value of the property is lower than what the borrower still owes on the loan. PMI can be costly to a borrower in that the $40-$50 a month per $100,000 borrowed is lumped into the mortgage payment and often isn't even tax deductible. It's profitable for the lender because they secure the money, and they receive payment if the borrower defaults, different from a piggyback loan where the lender absorbs all the damages. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can a home owner refrain from bearing the cost of PMI?The Homeowners Protection Act of 1998 forces the lenders on most loans to automatically cease the PMI when the principal balance of the loan reaches 78 percent of the original loan amount. The law stipulates that, at the request of the homeowner, the PMI must be abandoned when the principal amount equals only 80 percent. So, keen home owners can get off the hook a little early. Considering it can take countless years to arrive at the point where the principal is just 20% of the original amount borrowed, it's necessary to know how your home has grown in value. After all, all of the appreciation you've obtained over the years counts towards dismissing PMI. So what's the reason for paying it after your loan balance has fallen below the 80% mark? Your neighborhood may not be minding the national trends and/or your home could have secured equity before things calmed down, so even when nationwide trends forecast decreasing home values, you should realize that real estate is local. An accredited, licensed real estate appraiser can help home owners understand just when their home's equity goes over the 20% point, as it's a difficult thing to know. It is an appraiser's job to know the market dynamics of their area. At Felicia Sauder & Associates, Inc., we're experts at pinpointing value trends in Plain City, Union County and surrounding areas, and we know when property values have risen or declined. When faced with figures from an appraiser, the mortgage company will often do away with the PMI with little trouble. At which time, the home owner can delight in the savings from that point on.
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