The Homeowners Protection Act of 1998 obligates the lenders on the majority of loans to automatically terminate the Private Mortgage Insurance (PMI) when the principal balance of the loan reaches 78 percent of the primary loan amount. The law guarantees that, upon request of the homeowner, the PMI must be released when the principal amount reaches just 80 percent. So, savvy homeowners can get off the hook ahead of time.
It can take a significant number of years to arrive at the point where the principal is just 80% of the original amount of the loan, so it's essential to know how your home has increased in value. After all, every bit of appreciation you've accomplished over time counts towards removing PMI. So why should you pay it after your loan balance has dropped below the 80% threshold? Even when nationwide trends indicate decreasing home values, realize that real estate is local. Your neighborhood might not be heeding the national trends and/or your home might have acquired equity before things cooled off.
A certified, licensed real estate appraiser can help homeowners figure out just when their home's equity goes over the 20% point, as it's a hard thing to know. Market dynamics and neighborhood-specific pricing trends are an appraiser's primary job! We know when property values have risen or declined. We're masters at recognizing value trends in South Florida. Faced with figures from an appraiser, the mortgage company will usually eliminate the PMI with little effort. At which time, the home owner can retain the savings from that point on.
A&F Real Estate Appraisal Services is an independent property appraisal company serving Miami-Dade, Broward, Palm Beach, and Monroe Counties, South Florida. We provide the highest quality appraisals, unmatched customer service, and the lowest prices, guaranteed! Contact us to schedule your Residential Property Appraisal. Call (305) 573-1577 of fill out our Contact Form TODAY!