Let Desert Sky Appraisers help you determine if you can eliminate your PMIIt's generally understood that a 20% down payment is the standard when purchasing a home. The lender's liability is oftentimes only the difference between the home value and the sum due on the loan, so the 20% adds a nice buffer against the costs of foreclosure, selling the home again, and regular value changes in the event a borrower is unable to pay. The market was working with down payments as low as 10, 5 and often 0 percent during the mortgage boom of the mid 2000s. A lender is able to handle the additional risk of the small down payment with Private Mortgage Insurance or PMI. This supplementary plan protects the lender in the event a borrower defaults on the loan and the market price of the home is lower than the balance of the loan. PMI is pricey to a borrower because the $40-$50 a month per $100,000 borrowed is bundled into the mortgage payment and oftentimes isn't even tax deductible. It's profitable for the lender because they secure the money, and they receive payment if the borrower defaults, separate from a piggyback loan where the lender takes in all the losses. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can a homeowner keep from bearing the expense of PMI?The Homeowners Protection Act of 1998 forces the lenders on nearly all loans to automatically eliminate the PMI when the principal balance of the loan reaches 78 percent of the beginning loan amount. The law states that, upon request of the home owner, the PMI must be released when the principal amount reaches only 80 percent. So, savvy home owners can get off the hook a little earlier. Considering it can take many years to arrive at the point where the principal is just 20% of the initial loan amount, it's essential to know how your home has grown in value. After all, every bit of appreciation you've achieved over the years counts towards abolishing PMI. So what's the reason for paying it after the balance of your loan has dropped below the 80% mark? Your neighborhood may not be heeding the national trends and/or your home may have secured equity before things simmered down, so even when nationwide trends hint at plummeting 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 Desert Sky Appraisers, we know when property values have risen or declined. We're masters at recognizing value trends in Chandler, Maricopa County and surrounding areas. Faced with information from an appraiser, the mortgage company will usually cancel the PMI with little anxiety. At which time, the home owner can relish the savings from that point on.
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