Sauter Appraisal, LLC can help you remove your Private Mortgage InsuranceA 20% down payment is usually the standard when buying a house. The lender's liability is often only the difference between the home value and the sum due on the loan, so the 20% adds a nice cushion against the charges of foreclosure, selling the home again, and typical value changes on the chance that a purchaser is unable to pay. During the recent mortgage boom of the mid 2000s, it became widespread to see lenders requiring down payments of 10, 5 or even 0 percent. A lender is able to handle the additional risk of the small down payment with Private Mortgage Insurance or PMI. This supplemental policy protects the lender if a borrower is unable to pay on the loan and the value of the home is less than what the borrower still owes on the loan. Because the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and generally isn't even tax deductible, PMI can be expensive to a borrower. Separate from a piggyback loan where the lender consumes all the deficits, PMI is money-making for the lender because they collect the money, and they get paid if the borrower doesn't pay. 
Does your monthly mortgage payment include PMI? Contact us, you may be able to save money by removing your PMI. How can home buyers avoid paying PMI?The Homeowners Protection Act of 1998 requires the lenders on most loans to automatically cancel the PMI when the principal balance of the loan equals 78 percent of the initial loan amount. Wise home owners can get off the hook sooner than expected. The law designates that, at the request of the home owner, the PMI must be dropped when the principal amount equals just 80 percent. It can take many years to arrive at the point where the principal is only 20% of the original amount borrowed, so it's essential to know how your home has increased in value. After all, any appreciation you've obtained over the years counts towards abolishing PMI. So why pay it after the balance of your loan has fallen below the 80% mark? Even when nationwide trends forecast declining home values, be aware that real estate is local. Your neighborhood may not be reflecting the national trends and/or your home may have secured equity before things simmered down. An accredited, licensed real estate appraiser can help home owners understand just when their home's equity rises above the 20% point, as it's a tough thing to know. As appraisers, it's our job to keep up with the market dynamics of our area. At Sauter Appraisal, LLC, we know when property values have risen or declined. We're experts at identifying value trends in Wildwood, Saint Louis City County and surrounding areas. Faced with figures from an appraiser, the mortgage company will generally remove the PMI with little trouble. At that time, the homeowner can relish the savings from that point on.
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