Have equity in your home? Want a lower payment? An appraisal from B & B Valuations, 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 generally only the difference between the home value and the sum remaining on the loan, the 20% adds a nice buffer against the charges of foreclosure, selling the home again, and typical value variationson the chance that a purchaser doesn't pay. The market was taking down payments as low as 10, 5 and even 0 percent during the mortgage boom of the last decade. A lender is able to manage the increased risk of the minimal down payment with Private Mortgage Insurance or PMI. PMI covers the lender in case a borrower is unable to pay on the loan and the market price of the property is less than the loan balance. PMI can be pricey to a borrower because the $40-$50 a month per $100,000 borrowed is lumped into the mortgage payment and often isn't even tax deductible. It's advantageous for the lender because they collect the money, and they receive payment if the borrower doesn't pay, opposite from a piggyback loan where the lender consumes all the losses. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How home owners can prevent bearing the cost of PMIThe Homeowners Protection Act of 1998 obligates the lenders on most loans to automatically cease the PMI when the principal balance of the loan reaches 78 percent of the original loan amount. Wise home owners can get off the hook a little early. The law states that, at the request of the home owner, the PMI must be released when the principal amount equals just 80 percent. Because it can take many years to get to the point where the principal is only 20% of the original amount borrowed, it's necessary to know how your home has increased in value. After all, all of the appreciation you've accomplished over the years counts towards dismissing PMI. So why pay it after the balance of your loan has fallen below the 80% threshold? Despite the fact that nationwide trends indicate plummeting home values, understand that real estate is local. Your neighborhood might not be following the national trends and/or your home might have gained equity before things simmered down. A certified, licensed real estate appraiser can help home owners understand just when their home's equity goes over the 20% point, as it's a difficult thing to know. As appraisers, it's our job to know the market dynamics of our area. At B & B Valuations, LLC, we're masters at determining value trends in Katy, Fort Bend County and surrounding areas, and we know when property values have risen or declined. Faced with data from an appraiser, the mortgage company will often drop the PMI with little effort. At that time, the homeowner can enjoy the savings from that point on.
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