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 mortgage balance (for a loan made past July of that year) reaches less than seventy-eight percent of the purchase price, but not at the point the loan's equity gets to twenty-two percent or more. (Some "higher risk" mortgage loans are not included.) But if your equity reaches 20% (no matter what the original purchase price was), you have the right to cancel your PMI (for a loan that past July 1999).
Keep a running total of payments
Review your monthly statements often. Also stay aware of how much other homes are being sold for in your neighborhood. You are paying mostly interest if your mortgage 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 at the time you determine your equity has reached 20%. Call the lending institution to ask for cancellation of your Private Mortgage Insurance. The lending institution will require documentation that your equity is high enough. Usually lenders require a state certified appraisal documented on the form: URAR-1004 (Uniform Residential Appraisal Report) to determine your equity and eligibility for canceling PMI.
Tier One Mortgage, LLC can help find out if you can eliminate your PMI. Call us: (585) 282-0960.