Scott Appraisal LLC can help you remove your Private Mortgage InsuranceWhen buying a house, a 20% down payment is usually the standard. The lender's risk is often only the difference between the home value and the sum outstanding on the loan, so the 20% provides a nice cushion against the costs of foreclosure, reselling the home, and regular value changes on the chance that a purchaser doesn't pay. Lenders were taking down payments as low as 10, 5 and even 0 percent in the peak of last decade's mortgage boom. A lender is able to manage the increased risk of the small down payment with Private Mortgage Insurance or PMI. PMI takes care of the lender in the event a borrower defaults on the loan and the worth of the property is less than the balance of the loan. Because the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and frequently isn't even tax deductible, PMI is pricey to a borrower. It's profitable for the lender because they secure the money, and they get the money if the borrower doesn't pay, contradictory to a piggyback loan where the lender absorbs all the deficits. 
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 paying PMI?With the implementation of The Homeowners Protection Act of 1998, on nearly all loans lenders are forced to automatically terminate the PMI when the principal balance of the loan equals 78 percent of the primary loan amount. Keen home owners can get off the hook a little earlier. The law states that, upon request of the homeowner, the PMI must be abandoned when the principal amount equals only 80 percent. It can take countless years to arrive at the point where the principal is just 20% of the initial amount borrowed, so it's essential to know how your home has appreciated in value. After all, any appreciation you've accomplished over time counts towards abolishing PMI. So why pay it after the balance of your loan has dropped below the 80% threshold? Even when nationwide trends indicate decreasing home values, realize that real estate is local. Your neighborhood may not be reflecting the national trends and/or your home could have acquired equity before things calmed down. An accredited, licensed real estate appraiser can help home owners understand just when their home's equity goes over the 20% point, as it's a hard thing to know. As appraisers, it's our job to recognize the market dynamics of our area. At Scott Appraisal LLC, we know when property values have risen or declined. We're masters at analyzing value trends in Madison, Dane County and surrounding areas. Faced with data from an appraiser, the mortgage company will usually remove the PMI with little trouble. At that time, the home owner can retain the savings from that point on.
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