Make Private Mortgage Insurance a Thing of the Past
For loans made since July 1999, lenders are required (by federal law) to automatically cancel Private Mortgage Insurance (PMI) when the balance of the loan gets under 78 percent of your purchase amount � but not when the borrower achieves 22 percent equity. (Some "higher risk" loan programs are excluded.) The good news is that you can request cancelation of your PMI yourself (for your mortgage loan that closed past July '99), without considering the original price of purchase, at the point your equity climbs to twenty percent.
Do your homework
Analyze your monthly statements often. You'll want to keep track of the the purchase prices of the houses that sell around you. If your loan is fewer than five years old, it's likely you haven't greatly reduced principal � it's been mostly interest.
Once your equity has reached the required twenty percent, you are close to stopping your PMI payments, for the life of your loan. You will need to notify your mortgage lender that you wish to cancel PMI. Then you will be asked to verify that you have at least 20 percent equity. A state certified appraisal documented on the appropriate form (URAR-1004 - Uniform Residential Appraisal Report) verifies your equity amount � and your lender will probably require one before they'll cancel PMI.
Hancock Mortgage Partners, LLC NMLS# 229844 can answer questions about PMI and many others. Call us at 225 819 7670.