Make Private Mortgage Insurance a Thing of the Past
Since 1999, lenders have been required to cancel a borrower's Private Mortgage Insurance (PMI) at the point his loan balance (for loans made past July of '99) goes down below seventy-eight percent of the purchase price, but not at the point the borrower's equity gets to more than twenty-two percent. (Some "higher risk" morgages are not included.) However, if your equity reaches 20% (no matter what the original purchase price was), you have the right to cancel the PMI (for a loan closed after July 1999).
Keep a running total of payments
Analyze your monthly statements often. Find out the purchase prices of other houses in your immediate area. Unfortunately, if you have a new loan - five years or fewer, you likely haven't been able to pay a lot of the principal: you have been paying mostly interest.
You can start the process of PMI cancelation when you calculate that your equity has risen to 20%. Contact the mortgage lender to ask for cancellation of PMI. Your lender will require documentation that your equity is high enough. A state certified appraisal using the appropriate form (URAR-1004 - Uniform Residential Appraisal Report) is the best proof there is � and almost all lending institutions require one before they agree to cancel.
Hancock Mortgage Partners, LLC NMLS# 229844 can help find out if you can eliminate your PMI. Give us a call at 225 819 7670.