Your mortgage loan has PMI when you cannot pay 20% of the value of the home as down payment. This is the market's way of ensuring that you will pay the rest, or at least insuring the lender from buyers who are not able to pay off the value of their home. You have PMI if your company has confirmed to you that you have PMI. So you can call and ask them. Most companies have requirements for the removal of PMI, which you can have removed if you qualify. In other words, strive to meet all the requirements for the removal of PMI and ask your company to remove it.
The requirements for the removal of PMI vary depending on different companies. For most of them, the value of the LTV (loan-to-value) has to be less than 75%. When you want to find out the value of your LTV, you will divide the value of your current loan balance with the value of the property. To ensure that you have the currently market value of the property, get an appraisal done. This percentage should be less than 75% for the PMI to be removed by most companies. Getting the company to perform their appraisal of your home is more acceptable, since more companies will not accept the values of the appraisal you have done on your property.
Overall, getting your PMI cancelled requires you to estimate the value of your home and ensuring that it can qualify depending on your lender. Call your lender and get an appraisal of your home to determine the value of your home in the current market. It is important that the appraisal is done by the company itself. As you pay off the loan, keep an eye on the percentage of your LTV, to ensure that it has dropped to a level below 80% before you can call up your lender to remove PMI from your monthly payments.
This is such a convenience for lenders and home buyers to assure that they won't be placed in a compromising situation. I think it's a good thing for people who badly needs it.
ReplyDeleteIf you want to know more about PMI, please click here.