Have equity in your home? Want a lower payment? An appraisal from Alliance Appraisal, Inc. can help you get rid of your PMI.It's largely known that a 20% down payment is common when buying a house. Since the risk for the lender is often only the remainder between the home value and the sum due on the loan, the 20% adds a nice buffer against the charges of foreclosure, selling the home again, and natural value changesin the event a borrower doesn't pay. During the recent mortgage upturn of the last decade, it was customary to see lenders requiring down payments of 10, 5 or sometimes 0 percent. A lender is able to handle the increased risk of the small 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 house is lower than the balance of the loan. PMI can be expensive to a borrower in that 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 secure the money, and they get paid if the borrower defaults, opposite from a piggyback loan where the lender absorbs all the damages. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can home buyers keep from bearing the cost of PMI?The Homeowners Protection Act of 1998 requires the lenders on nearly all loans to automatically cancel the PMI when the principal balance of the loan reaches 78 percent of the original loan amount. Keen homeowners can get off the hook a little earlier. The law states that, upon request of the homeowner, the PMI must be abandoned when the principal amount equals just 80 percent. It can take many years to get to the point where the principal is just 20% of the original loan amount, so it's crucial to know how your home has grown in value. After all, every bit of appreciation you've gained over time counts towards removing PMI. So why should you pay it after your loan balance has fallen below the 80% mark? Your neighborhood might not be minding the national trends and/or your home could have acquired equity before things calmed down, so even when nationwide trends forecast declining home values, you should realize that real estate is local. An accredited, 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 understand the market dynamics of our area. At Alliance Appraisal, Inc., we know when property values have risen or declined. We're masters at determining value trends in Clifton, Fairfax County and surrounding areas. When faced with figures from an appraiser, the mortgage company will usually remove the PMI with little trouble. At that time, the homeowner can relish the savings from that point on.
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