Have equity in your home? Want a lower payment? An appraisal from Josef Realty Services, Inc. can help you get rid of your PMI.When buying a house, a 20% down payment is typically the standard. Considering the risk for the lender is oftentimes only the remainder between the home value and the amount remaining on the loan, the 20% supplies a nice cushion against the costs of foreclosure, reselling the home, and natural value changesin the event a purchaser is unable to pay. During the recent mortgage upturn of the mid 2000s, it became common to see lenders commanding down payments of 10, 5 or often 0 percent. How does a lender handle the increased risk of the low down payment? The solution is Private Mortgage Insurance or PMI. PMI covers the lender if a borrower defaults on the loan and the market price of the home is less than the loan balance. Because the $40-$50 a month per $100,000 borrowed is lumped into the mortgage payment and frequently isn't even tax deductible, PMI is pricey to a borrower. Unlike a piggyback loan where the lender takes in all the costs, PMI is profitable for the lender because they acquire the money, and they get paid if the borrower is unable to pay. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How home buyers can refrain from bearing the expense of PMIWith the implementation of The Homeowners Protection Act of 1998, on most loans lenders are forced to automatically cancel the PMI when the principal balance of the loan equals 78 percent of the primary loan amount. The law stipulates that, at the request of the homeowner, the PMI must be abandoned when the principal amount equals just 80 percent. So, savvy homeowners can get off the hook sooner than expected. Because it can take countless years to arrive at the point where the principal is just 20% of the initial loan amount, it's necessary to know how your home has grown in value. After all, all of the appreciation you've acquired over time counts towards abolishing PMI. So what's the reason for paying it after your loan balance has dropped below the 80% mark? Even when nationwide trends indicate plunging home values, be aware that real estate is local. Your neighborhood may not be following the national trends and/or your home may have secured equity before things simmered down. A certified, licensed real estate appraiser can help homeowners understand just when their home's equity goes over the 20% point, as it's a tough thing to know. As appraisers, it's our job to recognize the market dynamics of our area. At Josef Realty Services, Inc., we know when property values have risen or declined. We're masters at analyzing value trends in SAINT LOUIS, Saint Louis County and surrounding areas. Faced with figures from an appraiser, the mortgage company will often do away with the PMI with little trouble. At that time, the home owner can delight in the savings from that point on.
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