Let Zing Appraisals LLC help you discover if you can get rid of your PMIWhen buying a house, a 20% down payment is typically the standard. The lender's liability is usually only the remainder between the home value and the amount outstanding on the loan, so the 20% adds a nice cushion against the charges of foreclosure, selling the home again, and typical value changes in the event a borrower defaults. The market was accepting down payments as low as 10, 5 and even 0 percent during the mortgage boom of the last decade. How does a lender manage the increased risk of the small down payment? The answer 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 home is less than the balance of the loan. Since the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and many times isn't even tax deductible, PMI can be expensive to a borrower. Contradictory to a piggyback loan where the lender absorbs all the damages, PMI is favorable for the lender because they acquire the money, and they get paid 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 owners prevent bearing the expense of PMI?The Homeowners Protection Act of 1998 forces the lenders on most loans to automatically cease the PMI when the principal balance of the loan reaches 78 percent of the primary loan amount. The law designates that, upon request of the homeowner, the PMI must be released when the principal amount equals only 80 percent. So, wise home owners can get off the hook a little earlier. Since it can take many years to reach the point where the principal is just 20% of the initial amount of the loan, it's essential to know how your home has appreciated in value. After all, any appreciation you've obtained over the years counts towards removing PMI. So why should you pay it after the balance of your loan has fallen below the 80% mark? Your neighborhood may not be heeding the national trends and/or your home may have gained equity before things calmed down, so even when nationwide trends signify plunging home values, you should understand that real estate is local. A certified, licensed real estate appraiser can help homeowners understand just when their home's equity goes over the 20% point, as it's a difficult thing to know. It is an appraiser's job to recognize the market dynamics of their area. At Zing Appraisals, we know when property values have risen or declined. We're experts at analyzing value trends in Colorado Springs, El Paso & Pueblo Counties and surrounding areas. When faced with information from an appraiser, the mortgage company will usually cancel the PMI with little trouble. At which time, the homeowner can delight in the savings from that point on.
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