Have equity in your home? Want a lower payment? An appraisal from Georgia Appraisals can help you get rid of your PMI.It's generally known that a 20% down payment is the standard when getting a mortgage. The lender's risk is oftentimes only the remainder between the home value and the sum due on the loan, so the 20% supplies a nice cushion against the expenses of foreclosure, reselling the home, and regular value changes on the chance that a purchaser doesn't pay. During the recent mortgage boom of the last decade, it was common to see lenders requiring down payments of 10, 5 or often 0 percent. How does a lender manage the additional risk of the low down payment? The solution is Private Mortgage Insurance or PMI. PMI protects the lender in case a borrower doesn't pay on the loan and the value of the property is lower than what is owed on the loan. Because the $40-$50 a month per $100,000 borrowed is compiled into the mortgage monthly payment and oftentimes isn't even tax deductible, PMI can be expensive to a borrower. Different from a piggyback loan where the lender absorbs all the costs, PMI is favorable 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 a homebuyer refrain from bearing the cost of PMI?The Homeowners Protection Act of 1998 makes the lenders on nearly all loans to automatically cease the PMI when the principal balance of the loan equals 78 percent of the original loan amount. Smart home owners can get off the hook a little earlier. The law designates that, at the request of the homeowner, the PMI must be dropped when the principal amount reaches only 80 percent. Since it can take countless years to get to the point where the principal is only 20% of the initial amount borrowed, it's important to know how your home has increased in value. After all, every bit of appreciation you've gained over the years counts towards abolishing PMI. So what's the reason for paying it after your loan balance has fallen below the 80% threshold? Your neighborhood might not be heeding the national trends and/or your home may have gained equity before things simmered down, so even when nationwide trends forecast decreasing home values, you should understand that real estate is local. The difficult thing for almost all home owners to understand is just when their home's equity rises above the 20% point. A certified, licensed real estate appraiser can certainly help. It's an appraiser's job to know the market dynamics of their area. At Georgia Appraisals, we're masters at determining value trends in Clarkesville, Habersham County and surrounding areas, and we know when property values have risen or declined. When faced with figures from an appraiser, the mortgage company will generally do away with the PMI with little trouble. At which time, the home owner can retain the savings from that point on.
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