Have equity in your home? Want a lower payment? An appraisal from Bret Mundy Real Estate LLC can help you get rid of your PMI.When purchasing a home, a 20% down payment is typically the standard. Since the liability for the lender is often only the remainder between the home value and the sum outstanding on the loan, the 20% provides a nice buffer against the charges of foreclosure, reselling the home, and typical value changesin the event a purchaser is unable to pay. Banks were accepting down payments as low as 10, 5 and often 0 percent in the peak of last decade's mortgage boom. How does a lender manage the additional risk of the small down payment? The solution is Private Mortgage Insurance or PMI. PMI protects the lender if a borrower doesn't pay on the loan and the value of the property is lower than the balance of the loan. PMI is costly to a borrower because the $40-$50 a month per $100,000 borrowed is compiled into the mortgage payment and generally isn't even tax deductible. It's lucrative for the lender because they acquire the money, and they get the money if the borrower doesn't pay, different from a piggyback loan where the lender takes in all the costs. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can home buyers avoid bearing the expense of PMI?The Homeowners Protection Act of 1998 obligates the lenders on nearly all loans to automatically stop the PMI when the principal balance of the loan equals 78 percent of the beginning loan amount. Savvy home owners can get off the hook ahead of time. The law promises that, at the request of the home owner, 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 only 20% of the original loan amount, it's important to know how your home has grown in value. After all, any appreciation you've accomplished over time counts towards removing PMI. So why pay it after the balance of your loan has dropped below the 80% threshold? Your neighborhood might not be following the national trends and/or your home could have acquired equity before things simmered down, so even when nationwide trends signify decreasing home values, you should understand that real estate is local. An accredited, licensed real estate appraiser can help homeowners understand just when their home's equity goes over the 20% point, as it's a tough thing to know. It's an appraiser's job to know the market dynamics of their area. At Bret Mundy Real Estate LLC, we know when property values have risen or declined. We're experts at recognizing value trends in Taylorsville, Alexander County and surrounding areas. Faced with data from an appraiser, the mortgage company will generally do away with the PMI with little anxiety. At which time, the home owner can retain the savings from that point on.
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