Have equity in your home? Want a lower payment? An appraisal from Omotoso & Associates can help you get rid of your PMI.When purchasing a home, a 20% down payment is typically the standard. The lender's risk is oftentimes only the remainder between the home value and the sum due on the loan, so the 20% adds a nice cushion against the costs of foreclosure, reselling the home, and typical value variations on the chance that a purchaser doesn't pay. During the recent mortgage boom of the mid 2000s, it became widespread to see lenders taking down payments of 10, 5 or often 0 percent. A lender is able to manage the increased risk of the low down payment with Private Mortgage Insurance or PMI. This additional plan covers the lender if a borrower is unable to pay on the loan and the market price of the property is less than what is owed on the loan. PMI can be costly to a borrower in that the $40-$50 a month per $100,000 borrowed is bundled into the mortgage payment and oftentimes isn't even tax deductible. It's beneficial for the lender because they collect the money, and they get paid if the borrower is unable to pay, contradictory to a piggyback loan where the lender consumes all the damages. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How homebuyers can keep from paying PMIWith the utilization of The Homeowners Protection Act of 1998, on nearly all loans lenders are forced to automatically stop 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 ahead of time. The law pledges that, upon request of the homeowner, the PMI must be released when the principal amount equals only 80 percent. It can take many years to arrive at the point where the principal is just 20% of the initial amount borrowed, so it's crucial to know how your home has appreciated in value. After all, all of the appreciation you've obtained over the years counts towards dismissing PMI. So why pay it after your loan balance has dropped below the 80% mark? Your neighborhood may not be adopting the national trends and/or your home may have gained equity before things calmed down, so even when nationwide trends forecast falling home values, you should realize that real estate is local. The toughest thing for most homeowners to know is just when their home's equity rises above the 20% point. An accredited, licensed real estate appraiser can certainly help. As appraisers, it's our job to know the market dynamics of our area. At Omotoso & Associates, we know when property values have risen or declined. We're masters at recognizing value trends in Baltimore, Baltimore City County and surrounding areas. When faced with figures from an appraiser, the mortgage company will most often cancel the PMI with little effort. At that time, the homeowner can delight in the savings from that point on.
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