Albrecht Walz Appraisal Service, LLC can help you remove your Private Mortgage Insurance

When buying a house, a 20% down payment is typically the standard. Considering the liability for the lender is often only the remainder between the home value and the sum outstanding on the loan, the 20% supplies a nice cushion against the expenses of foreclosure, reselling the home, and typical value changes in the event a purchaser is unable to pay.

During the recent mortgage boom of the last decade, it became common to see lenders making deals with down payments of 10, 5, 3 or sometimes 0 percent. A lender is able to endure the additional risk of the small down payment with Private Mortgage Insurance or PMI. PMI covers the lender in case a borrower is unable to pay on the loan and the market price of the property is less than what the borrower still owes on the loan.

Since the $40-$50 a month per $100,000 borrowed is lumped into the mortgage payment and oftentimes isn't even tax deductible, PMI is pricey to a borrower. Instead of a piggyback loan where the lender takes in all the costs, PMI is beneficial for the lender because they secure the money, and they get paid if the borrower defaults.


	Did you have less than 20% to put down on your mortgage? Call Albrecht Walz Appraisal Service, LLC today at 608-786-3001 to see if you can save money by removing your Private Mortgage Insurance premium.

How can a homebuyer refrain from paying PMI?

As a result of The Homeowners Protection Act of 1998, lenders are forced to automatically terminate the PMI when the principal balance of the loan equals 78 percent of the primary loan amount on most loans. The law guarantees that, at the request of the homeowner, the PMI must be abandoned when the principal amount reaches just 80 percent. So, savvy home owners can get off the hook sooner than expected.

It can take several years to get to the point where the principal is just 80% of the initial loan amount, so it's important to know how your Wisconsin home has grown in value. After all, any appreciation you've accomplished over the years counts towards abolishing PMI. So why pay it after the balance of your loan has dropped below the 80% mark? Even when nationwide trends signify declining home values, understand that real estate is local. Your neighborhood might not be following the national trends and/or your home could have secured equity before things cooled off.

The difficult thing for most people to determine is just when their home's equity goes over the 20% point. An accredited, Wisconsin licensed real estate appraiser can definitely help. It's an appraiser's job to know the market dynamics of their area. At Albrecht Walz Appraisal Service, LLC, we know when property values have risen or declined. We're experts at determining value trends in Holmen, La Crosse County, and surrounding areas. When faced with figures from an appraiser, the mortgage company will most often do away with the PMI with little trouble. At that time, the homeowner can retain the savings from that point on.


	Does your monthly house payment have a lineitem for PMI? Call Albrecht Walz Appraisal Service, LLC today at 608-786-3001 or send us an e-mail. Documentation of your home's present value could save you thousands.

Want to learn more about PMI and the Homeowners Protection Act? Click this link:

Cancellation of Private Mortgage Insurance: Federal Law May Save You Hundreds of Dollars Each Year