Have equity in your home? Want a lower payment? An appraisal from Stanfield & Assoc can help you get rid of your PMI.A 20% down payment is usually accepted when getting a mortgage. The lender's risk is generally only the remainder between the home value and the amount due on the loan, so the 20% supplies a nice buffer against the costs of foreclosure, reselling the home, and natural value fluctuations on the chance that a borrower doesn't pay. During the recent mortgage boom of the mid 2000s, it was customary to see lenders commanding down payments of 10, 5 or often 0 percent. A lender is able to endure the added risk of the small down payment with Private Mortgage Insurance or PMI. This added policy guards the lender if a borrower doesn't pay on the loan and the value of the home is lower than the loan balance. PMI can be costly to a borrower in that the $40-$50 a month per $100,000 borrowed is rolled into the mortgage payment and often isn't even tax deductible. Contradictory to a piggyback loan where the lender consumes all the costs, PMI is lucrative for the lender because they acquire 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 paying PMI?With the utilization of The Homeowners Protection Act of 1998, on nearly all loans lenders are required to automatically cease the PMI when the principal balance of the loan reaches 78 percent of the beginning loan amount. Smart homeowners can get off the hook sooner than expected. The law states that, upon request of the home owner, the PMI must be dropped when the principal amount reaches just 80 percent. Because it can take many years to get to the point where the principal is only 20% of the initial amount borrowed, it's crucial to know how your home has appreciated in value. After all, all of the appreciation you've obtained over time counts towards dismissing PMI. So what's the reason for paying it after your loan balance has fallen below the 80% mark? Despite the fact that nationwide trends hint at declining home values, understand that real estate is local. Your neighborhood might not be reflecting the national trends and/or your home might have gained 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 tough thing to know. It's an appraiser's job to keep up with the market dynamics of their area. At Stanfield & Assoc, we're experts at determining value trends in Houston, Harris County and surrounding areas, and we know when property values have risen or declined. Faced with information from an appraiser, the mortgage company will most often drop the PMI with little effort. At that time, the home owner can enjoy the savings from that point on.
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