Signature Appraisals, Inc. can help you remove your Private Mortgage Insurance

It's generally known that a 20% down payment is common when getting a mortgage. Since the risk for the lender is often only the difference between the home value and the sum due on the loan, the 20% provides a nice buffer against the costs of foreclosure, reselling the home, and natural value variations on the chance that a purchaser is unable to pay.

During the recent mortgage boom of the last decade, it was widespread to see lenders only asking for down payments of 10, 5, 3 or sometimes 0 percent. How does a lender manage the added risk of the low down payment? The solution is Private Mortgage Insurance or PMI. This supplementary plan protects the lender in the event a borrower doesn't pay on the loan and the worth of the home is less than the loan balance.

PMI can be expensive 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 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.


	The amount you keep from cancelling the PMI required when you got your mortgage pays for the appraisal in no time. Nobody is more qualified than Signature Appraisals, Inc. when it comes to appreciating values in the city of Plymouth Meeting and Montgomery County. Contact us today.

How can a homebuyer keep from paying PMI?

With the passage of The Homeowners Protection Act of 1998, lenders are obligated to automatically cease the PMI when the principal balance of the loan equals 78 percent of the original loan amount on most loans. Savvy homeowners can get off the hook sooner than expected. The law states that, at the request of the home owner, the PMI must be released when the principal amount reaches just 80 percent.

Since it can take many years to reach the point where the principal is only 80% of the initial amount of the loan, it's essential to know how your Pennsylvania home has appreciated in value. After all, all of the appreciation you've accomplished over the years counts towards dismissing PMI. So what's the reason for paying it after the balance of your loan has fallen below the 80% mark? Your neighborhood might not conform to national trends and/or your home may have gained equity before the economy cooled off. So even when nationwide trends predict falling home values, you should know most importantly that real estate is local.

An accredited, Pennsylvania licensed real estate appraiser can help home owners figure out if their equity has exceeed the 20% point, as it's a hard thing to know. It is an appraiser's job to recognize the market dynamics of their area. At Signature Appraisals, Inc., we know when property values have risen or declined. We're experts at determining value trends in Plymouth Meeting, Montgomery County, and surrounding areas. When faced with figures from an appraiser, the mortgage company will often do away with the PMI with little effort. At which time, the home owner can retain the savings from that point on.


	The amount you keep from cancelling the PMI required when you got your mortgage pays for the appraisal in no time. Nobody is more qualified than Signature Appraisals, Inc. when it comes to appreciating values in Plymouth Meeting and Montgomery 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