Make Private Mortgage Insurance a Thing of the Past
While lending institutions have been legally required (for loans closed after July 1999) to cancel Private Mortgage Insurance (PMI) at the point the loan balance dips below 78% of the price of purchase, they do not have to cancel automatically if the equity is over 22%. (There are exceptions -like some loans considered 'high risk'.) But you can actually cancel PMI yourself (for mortgages made past July 1999) at the point your equity rises to 20 percent, regardless of the original purchase price.
Verify the numbers
Analyze your statements often. You'll want to stay aware of the prices of the houses that sell in your neighborhood. If your loan is fewer than five years old, it's likely you haven't paid down much principal � it's been mostly interest.
Proof of Equity
Once you find you have achieved at least 20 percent equity in your home, you can begin the process of freeing yourself from PMI payments. You will need to notify your mortgage lender that you wish to cancel PMI. Next, you will be required to verify that you have at least 20 percent equity. You can acquire proof of your 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.
New Millennium Mortgage Co. NMLS: 331173 can answer questions about PMI and many others. Give us a call at (941) 366-5800.
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