Have equity in your home? Want a lower payment? An appraisal from Barley Real Estate Appraisers can help you get rid of your PMI.When getting a mortgage, a 20% down payment is usually the standard. Because the risk for the lender is generally only the difference between the home value and the amount outstanding on the loan, the 20% adds a nice buffer against the expenses of foreclosure, reselling the home, and typical value changeson 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. How does a lender handle the added risk of the small down payment? The solution is Private Mortgage Insurance or PMI. This supplemental policy covers the lender in the event a borrower doesn't pay on the loan and the market price of the home is less than the loan balance. Because the $40-$50 a month per $100,000 borrowed is bundled into the mortgage monthly payment and oftentimes isn't even tax deductible, PMI can be costly to a borrower. Separate from a piggyback loan where the lender consumes all the losses, PMI is beneficial for the lender because they acquire the money, and they receive payment if the borrower defaults. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can home owners prevent bearing the cost of PMI?The Homeowners Protection Act of 1998 requires the lenders on nearly all loans to automatically eliminate the PMI when the principal balance of the loan reaches 78 percent of the beginning loan amount. The law promises that, upon request of the homeowner, the PMI must be dropped when the principal amount reaches just 80 percent. So, acute homeowners can get off the hook ahead of time. Because it can take countless years to get to the point where the principal is just 20% of the initial amount borrowed, it's important to know how your home has grown in value. After all, any appreciation you've obtained over time counts towards abolishing PMI. So what's the reason for paying it after your loan balance has fallen below the 80% mark? Your neighborhood might not be adhering to the national trends and/or your home could have secured equity before things calmed down, so even when nationwide trends signify decreasing home values, you should understand that real estate is local. The difficult thing for many homeowners to understand is just when their home's equity goes over the 20% point. An accredited, licensed real estate appraiser can surely help. As appraisers, it's our job to know the market dynamics of our area. At Barley Real Estate Appraisers , we know when property values have risen or declined. We're masters at analyzing value trends in Sullivans Island, Charleston County and surrounding areas. Faced with information from an appraiser, the mortgage company will usually do away with the PMI with little trouble. At which time, the homeowner can delight in the savings from that point on.
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