Marble Appraisals can help you remove your Private Mortgage Insurance

When purchasing a home, a 20% down payment is usually the standard. The lender's only exposure is usually just 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, reselling the home, and natural value variations in the event a borrower defaults.

Banks were accepting down payments as low as 10, 5 and frequently 0 percent in the peak of last decade's mortgage boom. How does a lender handle the increased risk of the low down payment? The answer is Private Mortgage Insurance or PMI. This supplementary plan protects the lender in case a borrower defaults on the loan and the value of the house is less than what the borrower still owes on the loan.

PMI can be expensive to a borrower on the grounds that the $40-$50 a month per $100,000 borrowed is compiled into the mortgage payment and many times isn't even tax deductible. It's profitable for the lender because they secure the money, and they get paid if the borrower is unable to pay, different from a piggyback loan where the lender absorbs all the damages.


	Does your monthly loan payment have a lineitem for PMI? Call Marble Appraisals today at 928-368-8868 or send us an e-mail. A recent appraisal could save you thousands.

How can buyers avoid bearing the cost of PMI?

The Homeowners Protection Act of 1998 forces the lenders on most loans to automatically cancel the PMI when the principal balance of the loan equals 78 percent of the primary loan amount. Savvy home owners can get off the hook sooner than expected. The law states that, upon request of the home owner, the PMI must be dropped when the principal amount reaches only 80 percent.

It can take a significant number of years to arrive at the point where the principal is only 80% of the initial amount borrowed, so it's crucial to know how your Arizona home has increased in value. After all, every bit of appreciation you've acquired over the years counts towards removing PMI. So why pay it after the balance of your loan has dropped below the 80% threshold? Your neighborhood might not conform to national trends and/or your home may have secured equity before things cooled off. So even when nationwide trends signify falling home values, you should know most importantly that real estate is local.

The hardest thing for most people to determine is whether their home equity has exceeded the 20% point. A certified, Arizona licensed real estate appraiser can certainly help. Market dynamics and neighborhood-specific pricing trends are an appraiser's primary job! At Marble Appraisals, we're experts at recognizing value trends in Lakeside, Navajo 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 eliminate the PMI with little effort. At which time, the homeowner can relish the savings from that point on.


	The money you keep from getting rid of the PMI required when you got your mortgage will make up for the price of the appraisal in a matter of months. Nobody is more qualified than Marble Appraisals when it comes to appreciating values in Lakeside and Navajo County. Contact us today.

Want to learn more about PMI and the Homeowners Protection Act? Click this link:

Cancellation of Private Mortgage Insurance: Federal Law May Save You Hundreds of Dollars Each Year

P.O. Box 1444
880 Rainbow View Drive
Lakeside, AZ 85929
928-368-8868 * Fax 928-368-6063