Tight & Right Real Estate Valuation can help you remove your Private Mortgage InsuranceA 20% down payment is usually the standard when purchasing a home. Considering the liability for the lender is often only the difference between the home value and the sum remaining on the loan, the 20% adds a nice buffer against the charges of foreclosure, reselling the home, and natural value fluctuationsin the event a borrower is unable to pay. During the recent mortgage upturn of the last decade, it became customary to see lenders taking down payments of 10, 5 or sometimes 0 percent. A lender is able to manage the added risk of the minimal down payment with Private Mortgage Insurance or PMI. PMI guards the lender in case a borrower doesn't pay on the loan and the market price of the property is less than the balance of the loan. Because the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and frequently isn't even tax deductible, PMI can be costly to a borrower. Different from a piggyback loan where the lender consumes all the deficits, PMI is advantageous for the lender because they collect the money, and they get the money if the borrower defaults. 
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?With the implementation of The Homeowners Protection Act of 1998, on most loans lenders are obligated to automatically terminate the PMI when the principal balance of the loan reaches 78 percent of the beginning loan amount. Smart homeowners can get off the hook sooner than expected. The law designates that, upon request of the home owner, the PMI must be dropped when the principal amount reaches only 80 percent. It can take countless years to arrive at the point where the principal is just 20% of the initial amount borrowed, so it's essential to know how your home has grown in value. After all, every bit of 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% mark? Even when nationwide trends forecast plunging home values, understand that real estate is local. Your neighborhood may not be adopting the national trends and/or your home might have secured equity before things settled down. The hardest thing for many home owners to know is just when their home's equity goes over the 20% point. A certified, licensed real estate appraiser can surely help. As appraisers, it's our job to know the market dynamics of our area. At Tight & Right Real Estate Valuation, we know when property values have risen or declined. We're experts at identifying value trends in Princeton, Union County and surrounding areas. When faced with data from an appraiser, the mortgage company will often drop the PMI with little trouble. At that time, the home owner can relish the savings from that point on.
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