Have equity in your home? Want a lower payment? An appraisal from Crest Appraisal Services can help you get rid of your PMI.A 20% down payment is usually accepted when buying a house. The lender's liability is often only the remainder between the home value and the sum outstanding on the loan, so the 20% provides a nice buffer against the costs of foreclosure, selling the home again, and regular value fluctuations in the event a purchaser defaults. Banks were taking down payments as low as 10, 5 and often 0 percent during the mortgage boom of the mid 2000s. A lender is able to handle the added risk of the reduced down payment with Private Mortgage Insurance or PMI. This supplemental policy guards the lender in case a borrower defaults on the loan and the worth of the property is lower than the balance of the loan. Because the $40-$50 a month per $100,000 borrowed is compiled into the mortgage payment and often isn't even tax deductible, PMI can be expensive to a borrower. Different from a piggyback loan where the lender consumes all the deficits, PMI is advantageous for the lender because they acquire the money, and they get the money 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 a home owner refrain from paying PMI?The Homeowners Protection Act of 1998 obligates the lenders on most loans to automatically eliminate the PMI when the principal balance of the loan reaches 78 percent of the initial loan amount. The law pledges that, at the request of the home owner, the PMI must be dropped when the principal amount equals just 80 percent. So, wise home owners can get off the hook a little early. It can take countless years to get to the point where the principal is only 20% of the initial amount borrowed, so it's important to know how your home has grown in value. After all, any appreciation you've achieved over time counts towards abolishing PMI. So why should you pay it after your loan balance has fallen below the 80% mark? Despite the fact that nationwide trends forecast falling home values, realize that real estate is local. Your neighborhood may not be adopting the national trends and/or your home could have gained equity before things calmed down. The hardest thing for almost all home owners to know is just when their home's equity goes over the 20% point. An accredited, licensed real estate appraiser can certainly help. It is an appraiser's job to know the market dynamics of their area. At Crest Appraisal Services, we're experts at analyzing value trends in Seattle, King County and surrounding areas, and we know when property values have risen or declined. When faced with data from an appraiser, the mortgage company will often drop the PMI with little trouble. At that time, the homeowner can delight in the savings from that point on.
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