Private Mortgage Insurance (PMI) allows homeowners to purchase property with less than 20% down payment helping the lender with reducing risk if the borrowers default. When is it time to check if Private Mortgage Insurance is no longer necessary due to property values increasing? Checking with a real estate agent in your area or mortgage advisor can assist you in determine the value of your home and whether or not it’s time to drop the extra money on your payment every month.
Removing Private Mortgage Insurance
The Consumer Finance Protection Bureau states these important criteria need to be met before dropping PMI:
Your request must be in writing.
You must have a good payment history and be current on your payments.
Your lender may require you to certify that there are no junior liens (such as a second mortgage) on your home.
Your lender can also require you to provide evidence (for example, an appraisal) that the value of your property hasn’t declined below the original value of the home. If the value of your home has decreased below the original value, you may not be able to cancel PMI at this time.
Borrower are eligible to remove PMI if the value of their home has reached 80% loan to value. Checking in with a real estate or mortgage professional can assist homeowners in determining eligibility for refinancing to a conventional loan, saving hundreds of thousands of dollars.
Take the guesswork out of your Home Value. Inquire with your mortgage professional that has the tools to estimate the value of your home. A FREE service we offer our customers. Remove Private Mortgage Insurance if the value of your home has increased to at least 80 percent loan-to-value.
Home Value Estimator-Determine the Current Market Value of Your Home.
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