Horewitz Valuation Services can help you remove your Private Mortgage InsuranceIt's generally inferred that a 20% down payment is common when getting a mortgage. Since the liability for the lender is often only the difference between the home value and the sum remaining on the loan, the 20% adds a nice cushion against the expenses of foreclosure, selling the home again, and regular value changesin the event a borrower doesn't pay. During the recent mortgage upturn of the mid 2000s, it became customary to see lenders commanding down payments of 10, 5 or even 0 percent. How does a lender manage the additional risk of the small down payment? The solution is Private Mortgage Insurance or PMI. This supplementary plan guards the lender in case a borrower doesn't pay on the loan and the worth of the home is less than the loan balance. PMI can be pricey to a borrower because the $40-$50 a month per $100,000 borrowed is rolled into the mortgage payment and generally isn't even tax deductible. It's beneficial for the lender because they acquire the money, and they receive payment if the borrower is unable to pay, unlike a piggyback loan where the lender absorbs 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 homebuyer refrain from bearing the cost of PMI?The Homeowners Protection Act of 1998 makes the lenders on most loans to automatically eliminate the PMI when the principal balance of the loan reaches 78 percent of the primary loan amount. The law designates that, upon request of the homeowner, the PMI must be released when the principal amount equals only 80 percent. So, keen home owners can get off the hook ahead of time. It can take countless years to get to the point where the principal is only 20% of the original amount of the loan, so it's essential to know how your home has appreciated in value. After all, every bit of appreciation you've obtained over the years counts towards dismissing PMI. So why should you pay it after the balance of your loan has fallen below the 80% threshold? Your neighborhood may not be reflecting the national trends and/or your home might have acquired equity before things calmed down, so even when nationwide trends signify plummeting home values, you should realize that real estate is local. The toughest thing for most home owners to understand is just when their home's equity goes over the 20% point. A certified, licensed real estate appraiser can definitely help. It is an appraiser's job to understand the market dynamics of their area. At Horewitz Valuation Services, we're masters at determining value trends in Danville, Contra Costa County and surrounding areas, and we know when property values have risen or declined. When faced with data from an appraiser, the mortgage company will usually cancel the PMI with little trouble. At which time, the homeowner can delight in the savings from that point on.
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