Make Private Mortgage Insurance a Thing of the Past
Since 1999, lending institutions have been legally required to cancel a borrower's Private Mortgage Insurance (PMI) when his mortgage balance (for a loan closed past July of '99) reaches less than seventy-eight percent of the purchase price, but not at the point the loan's equity gets to higher than twenty-two percent. (There are some loans that are excluded -like some "high risk' loans.) But you can actually cancel PMI yourself (for loans closed after July 1999) when your equity gets to 20 percent, without consideration of the original price of purchase.
Verify the numbers
Familiarize yourself with your mortgage statements to keep your eye on principal payments. Find out the purchase prices of other houses in your neighborhood. You are paying mostly interest if your mortgage loan closed fewer than 5 years ago, so your principal most likely hasn't been reduced by much.
The Proof is in the Appraisal
You can begin the process of PMI cancelation as soon as you're sure your equity reaches 20%. You will first notify your lender that you are asking to cancel your PMI. Then you will be required to submit documentation that you have at least 20 percent equity. A state certified appraisal documented on the appropriate form (URAR-1004 - Uniform Residential Appraisal Report) is the best proof there is � and most lending institutions request one before they agree to cancel PMI.
Iltis Lending Group can answer questions about PMI and many others. Give us a call: (941) 954-4252.