Make Private Mortgage Insurance a Thing of the Past
Since 1999, lending institutions 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) reaches less than seventy-eight percent of the price of purchase, but not when the loan's equity reaches over twenty-two percent. (The law does not include some higher risk mortgages.) But you have the right to cancel PMI yourself (for mortgages closed after July 1999) once your equity gets to 20 percent, regardless of the original price of purchase.
Keep a record of payments
Keep track of your principal payments. You'll want to keep track of the the purchase prices of the homes that sell around you. You've been paying mostly interest if you closed your mortgage loan fewer than 5 years ago, so your principal probably hasn't gone down much.
The Proof is in the Appraisal
You can begin the process of canceling your PMI when you determine your equity has risen to 20%. Contact the lending institution to request cancellation of your Private Mortgage Insurance. The lending institution will require proof that your equity is at 20 percent or above. You can get proof of your home's equity by getting a state certified appraisal on form URAR-1004 (Uniform Residential Appraisal Report), which is required by most lending institutions before canceling PMI.
Iltis Lending Group can answer questions about PMI and many others. Give us a call at (941) 954-4252.