Have equity in your home? Want a lower payment? An appraisal from Premier Appraisals, Inc. can help you get rid of your PMI.A 20% down payment is typically accepted when getting a mortgage. The lender's risk is usually only the remainder between the home value and the amount remaining on the loan, so the 20% supplies a nice buffer against the costs of foreclosure, selling the home again, and natural value changes in the event a borrower is unable to pay. The market was accepting down payments as low as 10, 5 and often 0 percent during the mortgage boom of the last decade. How does a lender handle the additional risk of the small down payment? The solution is Private Mortgage Insurance or PMI. PMI guards the lender if a borrower is unable to pay on the loan and the value of the house is lower than what is owed on the loan. Since the $40-$50 a month per $100,000 borrowed is lumped into the mortgage payment and oftentimes isn't even tax deductible, PMI can be costly to a borrower. Separate from a piggyback loan where the lender absorbs all the losses, PMI is lucrative for the lender because they obtain the money, and they receive payment 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 can buyers avoid paying PMI?With the implementation of The Homeowners Protection Act of 1998, on nearly all loans lenders are forced to automatically stop the PMI when the principal balance of the loan equals 78 percent of the beginning loan amount. The law promises that, upon request of the homeowner, the PMI must be released when the principal amount reaches only 80 percent. So, smart home owners can get off the hook ahead of time. It can take countless years to get to the point where the principal is just 20% of the initial amount borrowed, so it's necessary to know how your home has grown in value. After all, every bit of appreciation you've achieved over time counts towards removing PMI. So why should you pay it after your loan balance has dropped below the 80% threshold? Your neighborhood may not be adopting the national trends and/or your home might have acquired equity before things simmered down, so even when nationwide trends indicate declining home values, you should understand that real estate is local. The difficult thing for many home owners to know is just when their home's equity rises above the 20% point. A certified, licensed real estate appraiser can certainly help. As appraisers, it's our job to recognize the market dynamics of our area. At Premier Appraisals, Inc., we know when property values have risen or declined. We're masters at determining value trends in Nesconset, Suffolk County and surrounding areas. Faced with information from an appraiser, the mortgage company will most often cancel the PMI with little effort. At which time, the home owner can enjoy the savings from that point on.
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