Let YAH Real Estate Services help you figure out if you can eliminate your PMIA 20% down payment is typically the standard when purchasing a home. Since the liability for the lender is oftentimes only the difference between the home value and the sum due on the loan, the 20% adds a nice buffer against the expenses of foreclosure, selling the home again, and regular value fluctuationson the chance that a borrower defaults. During the recent mortgage upturn of the last decade, it was common to see lenders commanding down payments of 10, 5 or sometimes 0 percent. A lender is able to manage the added risk of the reduced down payment with Private Mortgage Insurance or PMI. This additional policy guards the lender in the event a borrower doesn't pay on the loan and the market price of the property is lower than what the borrower still owes on the loan. Since the $40-$50 a month per $100,000 borrowed is rolled into the mortgage monthly payment and many times isn't even tax deductible, PMI is costly to a borrower. Opposite from a piggyback loan where the lender takes in all the damages, PMI is lucrative for the lender because they secure the money, and they receive payment if the borrower doesn't pay. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can home buyers avoid bearing the expense of PMI?The Homeowners Protection Act of 1998 makes the lenders on most loans to automatically cease the PMI when the principal balance of the loan equals 78 percent of the initial loan amount. The law stipulates that, upon request of the homeowner, the PMI must be released when the principal amount reaches just 80 percent. So, keen home owners can get off the hook a little earlier. It can take many years to get to the point where the principal is only 20% of the original loan amount, so it's necessary to know how your home has appreciated in value. After all, all of the appreciation you've gained over time counts towards abolishing PMI. So why pay it after the balance of your loan has fallen below the 80% mark? Despite the fact that nationwide trends hint at falling home values, realize that real estate is local. Your neighborhood may not be reflecting the national trends and/or your home might have acquired equity before things simmered down. The difficult thing for almost all homeowners to understand is just when their home's equity goes over the 20% point. An accredited, licensed real estate appraiser can surely help. It's an appraiser's job to know the market dynamics of their area. At YAH Real Estate Services, we know when property values have risen or declined. We're masters at analyzing value trends in Braselton, Gwinnett County and surrounding areas. When faced with figures from an appraiser, the mortgage company will generally remove the PMI with little anxiety. At that time, the home owner can delight in the savings from that point on.
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