Make Private Mortgage Insurance a Thing of the Past
Although lending institutions have been obligated (for loans closed past July '99) to cancel Private Mortgage Insurance (PMI) when the balance dips below 78% of the purchase price, they do not have to take similar action if the loan's equity is over 22%. (The law does not include certain higher risk mortgages.) The good news is that you can cancel your PMI yourself (for a loan closing past July '99), regardless of the original price of purchase, at the point the equity reaches twenty percent.
Keep a running total of payments
Familiarize yourself with your monthly statements to keep your eye on principal payments. Make yourself aware of the purchase prices of other houses in your immediate area. If your loan is under five years old, it's likely you haven't made much progress with the principal � you have paid mostly interest.
At the point you find you have achieved at least 20 percent equity, you can begin the process of canceling your Private Mortgage Insurance. Contact the lending institution to request cancellation of your Private Mortgage Insurance. Next, you will be asked to verify that you are eligible to cancel. Usually lenders require a state certified appraisal documented on the form: URAR-1004 (Uniform Residential Appraisal Report) to verify your home's equity and eligibility for PMI cancellation.
U.S.A. Lending, Inc. can answer questions about PMI and many others. Give us a call at 305-967-7200.