Have equity in your home? Want a lower payment? An appraisal from Pritchard Appraisal Services can help you get rid of your PMI.It's largely inferred that a 20% down payment is common when purchasing a home. Because the risk for the lender is generally only the remainder between the home value and the sum remaining on the loan, the 20% supplies a nice buffer against the charges of foreclosure, selling the home again, and typical value changesin the event a purchaser doesn't pay. During the recent mortgage upturn of the mid 2000s, it was common to see lenders requiring down payments of 10, 5 or sometimes 0 percent. A lender is able to manage the added risk of the reduced down payment with Private Mortgage Insurance or PMI. PMI protects the lender in case a borrower is unable to pay on the loan and the market price of the house is lower than the loan balance. PMI is pricey to a borrower in that the $40-$50 a month per $100,000 borrowed is lumped into the mortgage payment and many times isn't even tax deductible. It's profitable for the lender because they obtain the money, and they get paid if the borrower defaults, separate from a piggyback loan where the lender consumes all the damages. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can a home buyer prevent bearing the expense of PMI?The Homeowners Protection Act of 1998 obligates the lenders on nearly all loans to automatically terminate the PMI when the principal balance of the loan equals 78 percent of the beginning loan amount. The law pledges that, upon request of the homeowner, the PMI must be released when the principal amount reaches just 80 percent. So, keen homeowners can get off the hook a little earlier. It can take countless years to get to the point where the principal is just 20% of the original loan amount, so it's important to know how your home has increased in value. After all, every bit of appreciation you've acquired over time counts towards dismissing PMI. So why pay it after the balance of your loan has dropped below the 80% mark? Your neighborhood may not be reflecting the national trends and/or your home could have secured equity before things simmered down, so even when nationwide trends hint at falling home values, you should understand that real estate is local. The hardest thing for many homeowners to know is just when their home's equity goes over the 20% point. A certified, licensed real estate appraiser can certainly help. As appraisers, it's our job to understand the market dynamics of our area. At Pritchard Appraisal Services, we know when property values have risen or declined. We're masters at pinpointing value trends in Mayfield, Graves County and surrounding areas. Faced with data from an appraiser, the mortgage company will usually do away with the PMI with little effort. At which time, the homeowner can enjoy the savings from that point on.
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