Let Tallent and Associates help you figure out if you can cancel your PMIIt's generally understood that a 20% down payment is accepted when getting a mortgage. Because the liability for the lender is usually only the remainder between the home value and the sum remaining on the loan, the 20% provides a nice cushion against the charges of foreclosure, reselling the home, and natural value variationsin the event a borrower is unable to pay. Lenders were accepting down payments down to 10, 5 and even 0 percent in the peak of last decade's mortgage boom. A lender is able to manage the added risk of the reduced down payment with Private Mortgage Insurance or PMI. This supplementary policy protects the lender in case a borrower is unable to pay on the loan and the market price of the home is lower than the balance of the loan. Since the $40-$50 a month per $100,000 borrowed is rolled into the mortgage payment and often isn't even tax deductible, PMI is costly to a borrower. It's favorable for the lender because they obtain the money, and they receive payment if the borrower doesn't pay, different from a piggyback loan where the lender absorbs all the deficits. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can a homebuyer keep from 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 initial loan amount. Savvy home owners can get off the hook sooner than expected. The law guarantees that, upon request of the homeowner, the PMI must be dropped when the principal amount reaches just 80 percent. Considering it can take countless years to get to the point where the principal is only 20% of the original amount of the loan, it's essential to know how your home has increased in value. After all, any appreciation you've acquired over time counts towards dismissing PMI. So why pay it after your loan balance has fallen below the 80% threshold? Your neighborhood might not be adopting the national trends and/or your home may have secured equity before things simmered down, so even when nationwide trends hint at declining home values, you should realize that real estate is local. The difficult thing for most homeowners to know is just when their home's equity rises above the 20% point. An accredited, licensed real estate appraiser can definitely help. As appraisers, it's our job to know the market dynamics of our area. At Tallent and Associates, we know when property values have risen or declined. We're masters at analyzing value trends in Concord, Cabarrus County and surrounding areas. When faced with information from an appraiser, the mortgage company will most often do away with the PMI with little effort. At that time, the homeowner can delight in the savings from that point on.
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