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 closed past July of '99) goes below seventy-eight percent of the purchase price, but not at the time the loan's equity gets to higher than twenty-two percent. (There are some exceptions -like some "high risk' loans.) However, you have the right to cancel PMI yourself (for mortgage loans made past July 1999) at the point your equity reaches 20 percent, regardless of the original price of purchase.
Verify the numbers
Review your monthly statements often. Make yourself aware of the selling prices of other homes in your neighborhood. If your loan is under five years old, chances are you haven't greatly reduced principal � it's been mostly interest.
Verify Equity Amount
As soon as your equity has risen to the required twenty percent, you are close to getting rid of your PMI payments, for the life of your loan. First you will tell your lender that you are requesting to cancel PMI. The lending institution will require documentation that your equity is at 20 percent or above. A state certified appraisal using the appropriate form (URAR-1004 - Uniform Residential Appraisal Report) is the best proof there is � and your lender will probably request one before they agree to cancel PMI.
Longhorn Mortgage can help find out if you can eliminate your PMI. Give us a call: 512-302-9410.
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