Have equity in your home? Want a lower payment? An appraisal from Accurate Valuation LLC can help you get rid of your PMI.

When purchasing a home, a 20% down payment is typically the standard. Because the liability for the lender is usually only the remainder between the home value and the amount outstanding on the loan, the 20% adds a nice cushion against the charges of foreclosure, selling the home again, and natural value fluctuations on the chance that a borrower defaults.

The market was accepting down payments as low as 10, 5 and often 0 percent during the mortgage boom of the last decade. A lender is able to handle the added risk of the minimal down payment with Private Mortgage Insurance or PMI. PMI takes care of the lender in the event a borrower is unable to pay on the loan and the market price of the home is less than what the borrower still owes on the loan.

Because the $40-$50 a month per $100,000 borrowed is bundled into the mortgage monthly payment and often isn't even tax deductible, PMI can be expensive to a borrower. Instead of a piggyback loan where the lender absorbs all the costs, PMI is profitable for the lender because they collect the money, and they get the money if the borrower defaults.


	Is PMI a lineitem in your monthly mortgage payment? Call Accurate Valuation LLC today at (970) 217-9981 or send us an e-mail. Documentation of your home's current value could save you thousands.

How can home owners prevent bearing the cost of PMI?

The Homeowners Protection Act of 1998 requires the lenders on most loans to automatically eliminate the PMI when the principal balance of the loan equals 78 percent of the primary loan amount. The law designates that, upon request of the homeowner, the PMI must be abandoned when the principal amount equals only 80 percent. So, smart home owners can get off the hook ahead of time.

It can take many years to reach the point where the principal is just 80% of the original amount borrowed, so it's crucial to know how your Colorado home has increased in value. After all, every bit of appreciation you've gained over time counts towards removing PMI. So why should you pay it after your loan balance has dropped below the 80% threshold? Your neighborhood may not follow national trends and/or your home might have secured equity before things cooled off. So even when nationwide trends predict a reduction in home values, you should know most importantly that real estate is local.

The difficult thing for almost all consumers to figure out is whether their home equity has exceeded the 20% point. An accredited, Colorado licensed real estate appraiser can certainly help. As appraisers, it's our job to keep up with the market dynamics of our area. At Accurate Valuation LLC, we're experts at recognizing value trends in Wellington, Larimer County, and surrounding areas, and we know when property values have risen or declined. Faced with figures from an appraiser, the mortgage company will usually do away with the PMI with little anxiety. At which time, the homeowner can enjoy the savings from that point on.


	Did you secure your mortgage with less than 20% down? Contact Accurate Valuation LLC today at (970) 217-9981. You may be able to save money by removing your Private Mortgage Insurance premium.

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