Mountain Home Properties can help you remove your Private Mortgage InsuranceA 20% down payment is typically the standard when purchasing a home. The lender's risk is generally only the remainder between the home value and the sum outstanding on the loan, so the 20% adds a nice cushion against the expenses of foreclosure, reselling the home, and typical value variations in the event a purchaser defaults. Banks were taking down payments down to 10, 5 and even 0 percent during the mortgage boom of the last decade. How does a lender endure the increased risk of the small down payment? The answer is Private Mortgage Insurance or PMI. This supplementary policy takes care of the lender if a borrower is unable to pay on the loan and the worth of the house is less than the balance of the loan. Because the $40-$50 a month per $100,000 borrowed is bundled into the mortgage monthly payment and generally isn't even tax deductible, PMI can be costly to a borrower. Unlike a piggyback loan where the lender consumes all the losses, PMI is advantageous for the lender because they acquire the money, and they get paid 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 buyers can keep from bearing the cost of PMIWith the utilization of The Homeowners Protection Act of 1998, on most loans lenders are obligated to automatically eliminate the PMI when the principal balance of the loan reaches 78 percent of the primary loan amount. Keen homeowners can get off the hook a little early. The law guarantees that, upon request of the homeowner, the PMI must be dropped when the principal amount reaches just 80 percent. Since it can take countless years to reach the point where the principal is only 20% of the original amount borrowed, it's important to know how your home has appreciated in value. After all, any appreciation you've acquired over time counts towards dismissing PMI. So why pay it after the balance of your loan has dropped below the 80% threshold? Even when nationwide trends predict falling home values, realize that real estate is local. Your neighborhood may not be heeding the national trends and/or your home may have secured equity before things settled down. An accredited, licensed real estate appraiser can help homeowners understand just when their home's equity goes over the 20% point, as it's a hard thing to know. It is an appraiser's job to know the market dynamics of their area. At Mountain Home Properties, we're masters at identifying value trends in Colorado Springs, El Paso County and surrounding areas, and we know when property values have risen or declined. Faced with figures from an appraiser, the mortgage company will often do away with the PMI with little anxiety. At that time, the homeowner can relish the savings from that point on.
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