Welch Appraisals can help you remove your Private Mortgage InsuranceA 20% down payment is usually the standard when purchasing a home. The lender's risk is oftentimes only the difference between the home value and the amount remaining on the loan, so the 20% provides a nice buffer against the expenses of foreclosure, selling the home again, and natural value changes in the event a purchaser is unable to pay. Lenders were taking down payments as low as 10, 5 and often 0 percent in the peak of last decade's mortgage boom. How does a lender endure the additional risk of the low down payment? The solution is Private Mortgage Insurance or PMI. This supplemental policy takes care of the lender in case a borrower defaults on the loan and the value of the home is less than what is owed on the loan. Because the $40-$50 a month per $100,000 borrowed is compiled into the mortgage monthly payment and generally isn't even tax deductible, PMI is costly to a borrower. It's lucrative for the lender because they collect the money, and they get the money if the borrower defaults, unlike 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 can home buyers avoid bearing the expense of PMI?The Homeowners Protection Act of 1998 obligates the lenders on nearly all loans to automatically cease the PMI when the principal balance of the loan reaches 78 percent of the primary loan amount. Acute home owners can get off the hook beforehand. The law pledges that, at the request of the home owner, the PMI must be released when the principal amount equals just 80 percent. Considering it can take many years to arrive at the point where the principal is just 20% of the initial amount of the loan, it's necessary to know how your home has increased in value. After all, any appreciation you've acquired over the years counts towards removing PMI. So why should you pay it after the balance of your loan has fallen below the 80% mark? Even when nationwide trends indicate declining home values, be aware that real estate is local. Your neighborhood might not be minding the national trends and/or your home might have acquired equity before things simmered down. An accredited, licensed real estate appraiser can help home owners understand just when their home's equity goes over the 20% point, as it's a difficult thing to know. It is an appraiser's job to know the market dynamics of their area. At Welch Appraisals, we're masters at identifying value trends in Cuero, De Witt County and surrounding areas, and we know when property values have risen or declined. When faced with figures from an appraiser, the mortgage company will generally cancel the PMI with little effort. At that time, the home owner can retain the savings from that point on.
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