Have equity in your home? Want a lower payment? An appraisal from Southern Appraisal Network, Inc. can help you get rid of your PMI.It's generally understood that a 20% down payment is common when getting a mortgage. Because the liability for the lender is oftentimes only the remainder between the home value and the amount remaining on the loan, the 20% supplies a nice buffer against the costs of foreclosure, selling the home again, and typical value variationsin the event a purchaser defaults. The market was taking down payments as low as 10, 5 and even 0 percent in the peak of last decade's mortgage boom. How does a lender endure the added risk of the small down payment? The solution is Private Mortgage Insurance or PMI. This added plan guards the lender if a borrower defaults on the loan and the market price of the home is lower than what the borrower still owes on the loan. Because the $40-$50 a month per $100,000 borrowed is rolled into the mortgage payment and frequently isn't even tax deductible, PMI is pricey to a borrower. It's lucrative for the lender because they acquire the money, and they receive payment if the borrower is unable to pay, different from a piggyback loan where the lender consumes all the losses. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can a buyer keep from paying PMI?The Homeowners Protection Act of 1998 makes the lenders on most loans to automatically cancel the PMI when the principal balance of the loan equals 78 percent of the primary loan amount. Acute home owners can get off the hook a little early. The law designates that, upon request of the home owner, the PMI must be released when the principal amount equals only 80 percent. Since it can take many years to reach the point where the principal is just 20% of the original loan amount, it's essential to know how your home has increased in value. After all, every bit of appreciation you've gained over the years counts towards dismissing PMI. So what's the reason for paying it after the balance of your loan has dropped below the 80% mark? Your neighborhood may not be minding the national trends and/or your home might have secured equity before things calmed down, so even when nationwide trends forecast falling home values, you should realize that real estate is local. The toughest thing for almost all homeowners to know is just when their home's equity rises above the 20% point. An accredited, licensed real estate appraiser can surely help. It's an appraiser's job to understand the market dynamics of their area. At Southern Appraisal Network, Inc., we're experts at identifying value trends in Chattanooga, Hamilton 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 usually remove the PMI with little effort. At which time, the home owner can enjoy the savings from that point on.
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