Have equity in your home? Want a lower payment? An appraisal from South Shore Realty Advisors, Inc can help you get rid of your PMI.It's typically understood that a 20% down payment is accepted when purchasing a home. The lender's liability is generally only the difference between the home value and the amount outstanding on the loan, so the 20% adds a nice cushion against the charges of foreclosure, selling the home again, and typical value changes in the event a purchaser defaults. The market was working with down payments down to 10, 5 and even 0 percent during the mortgage boom of the mid 2000s. How does a lender manage the additional risk of the small down payment? The solution is Private Mortgage Insurance or PMI. This added plan guards the lender in the event a borrower defaults on the loan and the value of the home is lower than what is owed on the loan. Since the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and frequently isn't even tax deductible, PMI is costly to a borrower. It's favorable for the lender because they acquire the money, and they get the money if the borrower defaults, different from a piggyback loan where the lender absorbs all the costs. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can buyers refrain from paying PMI?The Homeowners Protection Act of 1998 forces the lenders on nearly all loans to automatically cease the PMI when the principal balance of the loan equals 78 percent of the primary loan amount. The law designates that, at the request of the home owner, the PMI must be dropped when the principal amount reaches just 80 percent. So, keen homeowners can get off the hook a little earlier. It can take countless years to reach the point where the principal is just 20% of the original amount borrowed, so it's necessary to know how your home has increased in value. After all, any appreciation you've accomplished over time counts towards abolishing PMI. So why should you pay it after the balance of your loan has fallen below the 80% mark? Even when nationwide trends signify declining home values, be aware that real estate is local. Your neighborhood may not be minding the national trends and/or your home might have gained equity before things cooled off. 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 difficult thing to know. As appraisers, it's our job to keep up with the market dynamics of our area. At South Shore Realty Advisors, Inc, we know when property values have risen or declined. We're experts at identifying value trends in Marshfield, Plymouth County and surrounding areas. When faced with information from an appraiser, the mortgage company will usually cancel the PMI with little effort. At that time, the home owner can enjoy the savings from that point on.
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