Burnham Real Estate Appraisals, Inc can help you remove your Private Mortgage InsuranceWhen buying a house, a 20% down payment is usually the standard. Because the risk for the lender is generally only the remainder between the home value and the amount outstanding on the loan, the 20% supplies a nice buffer against the charges of foreclosure, selling the home again, and natural value changesin the event a borrower doesn't pay. Banks were working with down payments as low as 10, 5 and often 0 percent during the mortgage boom of the mid 2000s. How does a lender handle the increased risk of the small down payment? The answer is Private Mortgage Insurance or PMI. PMI covers the lender in the event a borrower defaults on the loan and the worth of the house is less than what the borrower still owes on the loan. PMI can be expensive to a borrower in that the $40-$50 a month per $100,000 borrowed is rolled into the mortgage payment and oftentimes isn't even tax deductible. Opposite from a piggyback loan where the lender consumes all the losses, PMI is beneficial for the lender because they obtain the money, and they receive payment 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 homeowners can prevent bearing the expense of PMIThe Homeowners Protection Act of 1998 obligates the lenders on most loans to automatically terminate the PMI when the principal balance of the loan equals 78 percent of the primary loan amount. The law promises that, at the request of the homeowner, the PMI must be dropped when the principal amount reaches just 80 percent. So, keen home owners can get off the hook a little earlier. It can take many years to reach the point where the principal is just 20% of the original amount borrowed, so it's important to know how your home has grown in value. After all, every bit of appreciation you've gained over time counts towards dismissing PMI. So what's the reason for paying it after the balance of your loan has dropped below the 80% threshold? Despite the fact that nationwide trends predict plummeting home values, be aware that real estate is local. Your neighborhood might not be heeding the national trends and/or your home might have acquired equity before things settled down. The toughest thing for many homeowners 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 keep up with the market dynamics of our area. At Burnham Real Estate Appraisals, Inc, we're masters at determining value trends in Virginia Beach , Virginia Beach City County and surrounding areas, and we know when property values have risen or declined. 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 home owner can enjoy the savings from that point on.
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