Bullinger Appraisals, LLC can help you remove your Private Mortgage InsuranceWhen getting a mortgage, a 20% down payment is typically the standard. Because the risk for the lender is generally only the difference between the home value and the amount outstanding on the loan, the 20% adds a nice cushion against the costs of foreclosure, reselling the home, and natural value fluctuationsin the event a borrower doesn't pay. During the recent mortgage boom of the mid 2000s, it became common to see lenders taking down payments of 10, 5 or often 0 percent. How does a lender manage the increased risk of the small down payment? The solution is Private Mortgage Insurance or PMI. This supplemental policy protects the lender if a borrower is unable to pay on the loan and the market price of the home is lower than what is owed on the loan. PMI can be pricey to a borrower because the $40-$50 a month per $100,000 borrowed is bundled into the mortgage monthly payment and many times isn't even tax deductible. It's beneficial for the lender because they collect the money, and they get paid if the borrower defaults, opposite from a piggyback loan where the lender consumes all the losses. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How home buyers can refrain from bearing the expense of PMIThe Homeowners Protection Act of 1998 requires the lenders on most loans to automatically cancel the PMI when the principal balance of the loan reaches 78 percent of the initial loan amount. Wise home owners can get off the hook beforehand. The law guarantees that, at the request of the home owner, the PMI must be dropped when the principal amount equals just 80 percent. It can take many years to get to the point where the principal is just 20% of the initial amount borrowed, so it's necessary to know how your home has appreciated in value. After all, any appreciation you've acquired over the years counts towards removing PMI. So what's the reason for paying it after the balance of your loan has dropped below the 80% mark? Your neighborhood may not be adopting the national trends and/or your home may have secured equity before things simmered down, so even when nationwide trends indicate decreasing home values, you should realize that real estate is local. The toughest thing for most home owners to know is just when their home's equity rises above the 20% point. An accredited, licensed real estate appraiser can surely help. As appraisers, it's our job to keep up with the market dynamics of our area. At Bullinger Appraisals, LLC, we know when property values have risen or declined. We're experts at identifying value trends in Fort Worth, Tarrant County and surrounding areas. When faced with data from an appraiser, the mortgage company will usually eliminate the PMI with little effort. At which time, the homeowner can relish the savings from that point on.
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