Have equity in your home? Want a lower payment? An appraisal from WalshStreet Appraisals can help you get rid of your PMI.

A 20% down payment is typically the standard when buying a house. Since the liability for the lender is often only the difference between the home value and the amount due on the loan, the 20% supplies a nice buffer against the expenses of foreclosure, reselling the home, and typical value changes on the chance that a purchaser is unable to pay.

During the recent mortgage upturn of the last decade, it was customary to see lenders only asking for down payments of 10, 5 or even 0 percent. A lender is able to endure the added risk of the minimal down payment with Private Mortgage Insurance or PMI. This supplemental policy protects the lender in the event a borrower doesn't pay on the loan and the value of the home is less than what is owed on the loan.

PMI is pricey to a borrower because the $40-$50 a month per $100,000 borrowed is lumped into the mortgage monthly payment and many times isn't even tax deductible. It's beneficial for the lender because they obtain the money, and they are covered if the borrower defaults, separate from a piggyback loan where the lender consumes all the damages.


Does your monthly house payment have a lineitem for PMI? Call WalshStreet Appraisals today at 323-936-9970 or send us an e-mail. Documentation of your home's present value could save you thousands.

How home owners can keep from bearing the expense of PMI

The Homeowners Protection Act of 1998 makes the lenders on nearly all loans to automatically cease the PMI when the principal balance of the loan equals 78 percent of the initial loan amount. The law stipulates that, upon request of the homeowner, the PMI must be abandoned when the principal amount equals just 80 percent. So, smart homeowners can get off the hook ahead of time.

It can take many years to get to the point where the principal is just 80% of the original amount borrowed, so it's essential to know how your California home has appreciated in value. After all, every bit of appreciation you've gained over the years counts towards abolishing PMI. So what's the reason for paying it after the balance of your loan has fallen below the 80% mark? Your neighborhood may not follow national trends and/or your home might have acquired equity before the economy declined. So even when nationwide trends signify declining home values, you should know most importantly that real estate is local.

The difficult thing for almost all consumers to figure out is just when their home's equity rises above the 20% point. A certified, California licensed real estate appraiser can certainly help. It's an appraiser's job to understand the market dynamics of their area. At WalshStreet Appraisals, we know when property values have risen or declined. We're experts at analyzing value trends in Los Angeles, Los Angeles County, and surrounding areas. When faced with information from an appraiser, the mortgage company will often drop the PMI with little effort. At that time, the home owner can relish the savings from that point on.


The money you keep from dropping your PMI pays for the appraisal in no time. Nobody is more qualified than WalshStreet Appraisals when it comes to appreciating values in Los Angeles and Los Angeles County. Contact us today.

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