Let Golden Quality Appraisal Services help you determine if you can eliminate your PMIWhen buying a house, a 20% down payment is usually the standard. The lender's risk is usually only the difference between the home value and the amount remaining on the loan, so the 20% provides a nice cushion against the expenses of foreclosure, reselling the home, and natural value changes in the event a purchaser is unable to pay. The market was accepting down payments down to 10, 5 and often 0 percent during the mortgage boom of the last decade. A lender is able to endure the increased risk of the low down payment with Private Mortgage Insurance or PMI. This supplemental policy takes care of the lender in case a borrower doesn't pay on the loan and the market price of the property is lower than what is owed on the loan. PMI is costly to a borrower in that the $40-$50 a month per $100,000 borrowed is rolled into the mortgage monthly payment and often isn't even tax deductible. Contradictory to a piggyback loan where the lender consumes all the damages, PMI is money-making for the lender because they acquire the money, and they get paid 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 a home buyer keep from bearing the expense of PMI?With the utilization of The Homeowners Protection Act of 1998, on most loans lenders are obligated to automatically eliminate the PMI when the principal balance of the loan reaches 78 percent of the beginning loan amount. The law stipulates that, upon request of the home owner, the PMI must be abandoned when the principal amount equals just 80 percent. So, wise home owners can get off the hook sooner than expected. It can take many years to get to the point where the principal is just 20% of the initial amount borrowed, so it's important to know how your home has grown in value. After all, all of the appreciation you've achieved over the years counts towards removing PMI. So why should you pay it after your loan balance has dropped below the 80% mark? Your neighborhood may not be reflecting the national trends and/or your home might have acquired equity before things settled down, so even when nationwide trends forecast decreasing home values, you should realize that real estate is local. The difficult thing for almost all home owners to understand is just when their home's equity rises above the 20% point. An accredited, licensed real estate appraiser can surely help. It's an appraiser's job to recognize the market dynamics of their area. At Golden Quality Appraisal Services, we know when property values have risen or declined. We're experts at identifying value trends in Orinda, Contra Costa County and surrounding areas. When faced with figures from an appraiser, the mortgage company will generally remove the PMI with little anxiety. At which time, the homeowner can enjoy the savings from that point on.
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