Have equity in your home? Want a lower payment? An appraisal from Edwards Appraisal Service, Inc. can help you get rid of your PMI.It's typically inferred that a 20% down payment is accepted when getting a mortgage. The lender's liability is generally only the remainder between the home value and the amount due on the loan, so the 20% provides a nice cushion against the costs of foreclosure, selling the home again, and typical value changes in the event a borrower defaults. During the recent mortgage boom of the last decade, it became customary to see lenders taking down payments of 10, 5 or even 0 percent. How does a lender manage the added risk of the small down payment? The answer is Private Mortgage Insurance or PMI. PMI guards the lender if a borrower is unable to pay on the loan and the value of the property is less than what is owed on the loan. PMI is costly to a borrower in that the $40-$50 a month per $100,000 borrowed is bundled into the mortgage monthly payment and often isn't even tax deductible. Separate from a piggyback loan where the lender absorbs all the damages, PMI is money-making for the lender because they obtain 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 a homebuyer prevent bearing the expense of PMI?The Homeowners Protection Act of 1998 requires the lenders on most loans to automatically cease the PMI when the principal balance of the loan reaches 78 percent of the original loan amount. Wise homeowners can get off the hook a little early. The law states that, at the request of the home owner, the PMI must be abandoned when the principal amount equals only 80 percent. Because it can take many years to get to the point where the principal is just 20% of the initial amount of the loan, it's essential to know how your home has increased in value. After all, all of the appreciation you've achieved over the years counts towards dismissing PMI. So why should you pay it after your loan balance has fallen below the 80% mark? Even when nationwide trends signify plunging home values, understand that real estate is local. Your neighborhood may not be reflecting the national trends and/or your home may have secured equity before things simmered down. A certified, licensed real estate appraiser can help home owners understand just when their home's equity rises above the 20% point, as it's a tough thing to know. As appraisers, it's our job to keep up with the market dynamics of our area. At Edwards Appraisal Service, Inc., we're experts at pinpointing value trends in Goldsboro, Wayne 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 do away with the PMI with little anxiety. At which time, the home owner can enjoy the savings from that point on.
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