MJ Anderson Group can help you remove your Private Mortgage InsuranceWhen getting a mortgage, a 20% down payment is typically the standard. The lender's liability is oftentimes only the difference between the home value and the amount outstanding on the loan, so the 20% provides a nice buffer against the charges of foreclosure, reselling the home, and regular value fluctuations on the chance that a purchaser doesn't pay. During the recent mortgage upturn of the mid 2000s, it was customary to see lenders requiring down payments of 10, 5 or even 0 percent. A lender is able to endure the added risk of the low down payment with Private Mortgage Insurance or PMI. PMI guards the lender in the event a borrower doesn't pay on the loan and the worth of the property is less than the balance of the loan. Because the $40-$50 a month per $100,000 borrowed is compiled into the mortgage payment and many times isn't even tax deductible, PMI can be costly to a borrower. It's profitable for the lender because they acquire the money, and they get the money if the borrower doesn't pay, separate from a piggyback loan where the lender absorbs all the losses. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How buyers can avoid bearing the cost of PMIWith the implementation of The Homeowners Protection Act of 1998, on nearly all loans lenders are required to automatically eliminate the PMI when the principal balance of the loan equals 78 percent of the beginning loan amount. The law stipulates that, at the request of the home owner, the PMI must be dropped when the principal amount reaches just 80 percent. So, smart home owners can get off the hook a little earlier. Since it can take many years to get to 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, any appreciation you've acquired over time counts towards removing PMI. So why should you pay it after the balance of your loan has fallen below the 80% threshold? Despite the fact that nationwide trends signify falling home values, understand that real estate is local. Your neighborhood may not be adopting the national trends and/or your home might have acquired equity before things calmed down. A certified, licensed real estate appraiser can help homeowners understand just when their home's equity rises above the 20% point, as it's a hard thing to know. As appraisers, it's our job to keep up with the market dynamics of our area. At MJ Anderson Group, we know when property values have risen or declined. We're masters at pinpointing value trends in McKinney, Collin County and surrounding areas. When faced with data from an appraiser, the mortgage company will generally do away with the PMI with little trouble. At which time, the homeowner can retain the savings from that point on.
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