Have equity in your home? Want a lower payment? An appraisal from VP Appraisal Services, Inc. can help you get rid of your PMI.It's widely known that a 20% down payment is common when buying a house. Because the risk for the lender is oftentimes only the difference between the home value and the sum remaining on the loan, the 20% adds a nice cushion against the charges of foreclosure, selling the home again, and natural value fluctuationson the chance that a purchaser is unable to pay. The market was taking down payments down to 10, 5 and often 0 percent in the peak of last decade's mortgage boom. How does a lender endure the added risk of the low down payment? The solution is Private Mortgage Insurance or PMI. This additional policy protects the lender in the event a borrower doesn't pay on the loan and the worth of the home is lower than what the borrower still owes on the loan. PMI can be costly to a borrower because the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and frequently isn't even tax deductible. It's profitable for the lender because they secure the money, and they receive payment if the borrower doesn't pay, contradictory to a piggyback loan where the lender takes in all the deficits. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can a buyer avoid bearing the expense of PMI?The Homeowners Protection Act of 1998 makes the lenders on nearly all loans to automatically terminate the PMI when the principal balance of the loan equals 78 percent of the original loan amount. Savvy home owners can get off the hook ahead of time. The law guarantees that, upon request of the homeowner, the PMI must be dropped when the principal amount reaches only 80 percent. Considering it can take countless years to get to the point where the principal is just 20% of the original loan amount, it's crucial to know how your home has grown in value. After all, every bit of appreciation you've acquired 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 adhering to the national trends and/or your home may have acquired equity before things settled down, so even when nationwide trends predict plunging home values, you should understand that real estate is local. An accredited, licensed real estate appraiser can help home owners understand just when their home's equity rises above the 20% point, as it's a difficult thing to know. As appraisers, it's our job to recognize the market dynamics of our area. At VP Appraisal Services, Inc., we know when property values have risen or declined. We're masters at determining value trends in Thousand Oaks, Ventura County and surrounding areas. Faced with data from an appraiser, the mortgage company will generally drop the PMI with little anxiety. At which time, the homeowner can delight in the savings from that point on.
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