Have equity in your home? Want a lower payment? An appraisal from Cristofaro Appraisal can help you get rid of your PMI.It's typically known that a 20% down payment is accepted when getting a mortgage. The lender's liability is generally only the difference between the home value and the sum due on the loan, so the 20% supplies a nice buffer against the charges of foreclosure, reselling the home, and natural value changes in the event a purchaser is unable to pay. During the recent mortgage boom of the last decade, it was customary to see lenders taking down payments of 10, 5 or sometimes 0 percent. How does a lender manage the additional risk of the low down payment? The answer is Private Mortgage Insurance or PMI. PMI protects the lender if a borrower defaults on the loan and the market price of the home is less than what is owed on the loan. PMI can be pricey to a borrower in that the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and frequently isn't even tax deductible. Different from a piggyback loan where the lender absorbs all the losses, PMI is beneficial for the lender because they acquire the money, and they receive payment if the borrower is unable to pay. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can homeowners refrain from paying PMI?With the utilization of The Homeowners Protection Act of 1998, on nearly all loans lenders are required to automatically cancel the PMI when the principal balance of the loan reaches 78 percent of the primary loan amount. Wise home owners can get off the hook a little earlier. The law designates that, upon request of the homeowner, the PMI must be abandoned when the principal amount equals only 80 percent. Considering it can take many years to reach the point where the principal is only 20% of the original loan amount, it's crucial to know how your home has appreciated in value. After all, all of the appreciation you've gained over time counts towards abolishing PMI. So why should you pay it after your loan balance has fallen below the 80% threshold? Your neighborhood might not be adhering to the national trends and/or your home could have gained equity before things settled down, so even when nationwide trends predict falling home values, you should understand that real estate is local. An accredited, licensed real estate appraiser can help home owners understand just when their home's equity rises above the 20% point, as it's a hard thing to know. It is an appraiser's job to recognize the market dynamics of their area. At Cristofaro Appraisal, we know when property values have risen or declined. We're experts at analyzing value trends in Huntington Beach, Orange County and surrounding areas. Faced with data from an appraiser, the mortgage company will often drop the PMI with little anxiety. At which time, the homeowner can retain the savings from that point on.
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