I am paying PMI and want to know how to get rid of it after my
property's value has appreciated.

Let's say I bought a condo at 200K and put down 10% = 20K.
I've had to pay PMI since my paid principal was less than 20% = 40K.

I have since made enough payments to have 15% = 30K. I basically
need another 10K to cancel the PMI.

However, my condo has appreciated by 50K since I bought it.
I've also done some fix-ups (paint, new kitchen, etc.). My thinking
is that my equity in the house is 30K + 50K = 80K, which is greater
than the original 40K, which should make me eligible to cancel PMI.
Is this correct?

"Digital Puer" writes:

My thinking
is that my equity in the house is 30K + 50K = 80K, which is greater
than the original 40K, which should make me eligible to cancel PMI.
Is this correct?

Yes.

You can ask your lender to cancel PMI (they will likely require
you to pay for appraisal, but that fee will probably amount to just
1 or 2 PMI payments, so you'll be better off soon).

If the lender gives you hard time, or requires you to refinance,
you should read this as well:
http://www.mtgprofessor.com/refinancing.htm
http://www.mtgprofessor.com/A%20-%20...ent_lender.htm

Cheers,
--
In order to understand recursion you must first understand recursion.
Remove /-nsp/ for email.

Some lenders will work with you, some will stonewall you. I'd guess
that if you've been there 2 years and an appraisal shows your loan to
value ratio is below 80%, as you claim, then they will cancel it.

That 2 years thing sticks in my head, I think that was mentioned in my
PMI docs but maybe I have my wires crossed.

First step would be to call your mortgage holder, tell them what you
stated here, and ask what their process is to cancel PMI. You could
refi but you shouldn't if your current rate is below what you can get
now, the lender should not 'make' you refi or (I think, it's been a
while) pay any cancelallation fees or do anything but pay for an
appraisal.

"Digital Puer" wrote in message
oups.com...
I am paying PMI and want to know how to get rid of it after my
property's value has appreciated.
\

You have to call the lender and ask them what their specific procedure is
for doing this.
When we wanted the PMI removed from our loan, we had to pay something like
$300 for a new appraisal because it had been more than a year since we
purchased the house. Then we had to sign a form requesting that they stop
charging it.

Sorry to disapoint you, but under the law the lenders are automatically
required to drop the PMI insurance from your mortgage once you've
reached the 20%. However that is based on the actual amount paid down.
Lenders are not required by law to take into consideration how much
your home has appreciated. It's based purely on the loan amount & how
much you have actually paid down on it.
The market value today of your home has nothing to do with the loan and
how much you owe on it.

Donna Dorn, Realtor, E-Pro
Long & Foster Real Estate Inc.
Bel Air, MD
Ph# 717-817-6288
email :
Website : http://DonnaDorn.com

Sorry to disapoint you, but under the law the lenders are automatically
required to drop the PMI insurance from your mortgage once you've
reached the 20%. However that is based on the actual amount paid down.
Lenders are not required by law to take into consideration how much
your home has appreciated. It's based purely on the loan amount & how
much you have actually paid down on it.
The market value today of your home has nothing to do with the loan and
how much you owe on it.

Donna Dorn, Realtor, E-Pro
Long & Foster Real Estate Inc.
Bel Air, MD
Ph# 717-817-6288
email :
Website : http://DonnaDorn.com

In article om,
Donna Dorn-Realtor, Long & Foster wrote:

Sorry to disapoint you, but under the law the lenders are automatically
required to drop the PMI insurance from your mortgage once you've
reached the 20%. However that is based on the actual amount paid down.
Lenders are not required by law to take into consideration how much
your home has appreciated. It's based purely on the loan amount & how
much you have actually paid down on it.
The market value today of your home has nothing to do with the loan and
how much you owe on it.


Once you tell them you are going to refinance they may have a different
opinion.


Dimitri

"Donna Dorn-Realtor, Long & Foster" writes:
Sorry to disapoint you, but under the law the lenders are
automatically required to drop the PMI insurance from your mortgage
once you've reached the 20%. However that is based on the actual
amount paid down. Lenders are not required by law to take into
consideration how much your home has appreciated. It's based purely
on the loan amount & how much you have actually paid down on it.
The market value today of your home has nothing to do with the loan
and how much you owe on it.

But it does determine the value of the instrument against which the
loan is secured, and at the end of the day, mortgage lenders are all
about risk calculations, and how much of the loan they'd be able to
recover in a foreclosure sale.

Don't the regulations on what lenders are required to do vary by
state?

Best Regards,
--
Todd H.
http://www.toddh.net/

That is about what it cost me many years ago - $300 for the appraisal.
I called the lender and they sent me a list of appraisers in the area
that they would accept. I scheduled an appraisal, about five minute
walkthrough of the house. I picked up the completed appraisal a couple
days later and sent it to the bank, probably with an additional form.
Pretty easy, and paid for itself in a few months.

In article om,
Donna Dorn-Realtor, Long & Foster wrote:
Sorry to disapoint you, but under the law the lenders are automatically
required to drop the PMI insurance from your mortgage once you've
reached the 20%. However that is based on the actual amount paid down.
Lenders are not required by law to take into consideration how much
your home has appreciated. It's based purely on the loan amount & how
much you have actually paid down on it.
The market value today of your home has nothing to do with the loan and
how much you owe on it.

Almost correct there. They are not required to take the appreciation
into account, but neither are they forbidden to do so. Some do, some
don't.

--
Rich Greenberg Marietta, GA, USA richgr atsign panix.com + 1 770 321 6507
Eastern time. N6LRT I speak for myself & my dogs only. VM'er since CP-67
Canines:Val, Red & Shasta (RIP),Red, husky Owner:Chinook-L
Atlanta Siberian Husky Rescue. www.panix.com/~richgr/ Asst Owner:Sibernet-L

I haven't seen a lender yet that would take appreciation into account,
nor have I seen one that cares if you refinance. The reason lenders
don't consider appreciation is that the same economic factors that
helped your home to appreciate can at any time, turn around and cause
your home to depreciate instead. There's dozens of events that could
cause that to happen at any time, so why would a lender take risks they
don't have to. Lenders don't like risks.

In article .com,
Donna Dorn-Realtor, Long & Foster wrote:
I haven't seen a lender yet that would take appreciation into account,
nor have I seen one that cares if you refinance.


If your lender doesn't care if you refinance then just refinance. Problem
solved. Most lenders would rather not lose your business over PMI,
especially if the house has appreciated significantly. The new lender
will look at the appraised value versus the amount you want to borrow
and the PMI will be gone. Most lenders know this and thus *do* take
appreciation into account. I know this, because there was a time I did
it myself. I even refinanced with the same lender at a lower rate without
the PMI.


Dimitri

"Donna Dorn-Realtor, Long & Foster" writes:

I haven't seen a lender yet that would take appreciation into
account,

I don't doubt that you haven't.

Then again DonnaDorn.com was created a couple months ago, and you've
since started popping into various internet groups introducing
yourself as a Realtor and offering your services. Which leads me to
wonder a simple question of:

Just how long HAVE you been a Realtor?

Take no offense, but as a client of serveral Realtors over the years,
the ones that send me running away screaming in the opposite direction
are those who don't know what they do not know.

I.e. they speak in absolutes and make no allowance for the possibility
that their experience in their local market isn't universal, and that
they might not know everything in related but very separate
specialties of mortgages, construction, and real estate law.

Best Regards,
--
Todd H.
http://www.toddh.net/

D. Gerasimatos wrote:
In article .com,
Donna Dorn-Realtor, Long & Foster wrote:
I haven't seen a lender yet that would take appreciation into account,
nor have I seen one that cares if you refinance.


If your lender doesn't care if you refinance then just refinance. Problem
solved.

That's unlikely to solve anything. The example he gave was a 200K
condo that had appreciated to $250K. In most of the US, that means he
very likely bought it not too long ago, like in the last 5 years, when
interest rates were likely lower than they are today. Refinancing to
a higher rate would likely more than negate the savings in PMI.



Most lenders would rather not lose your business over PMI,
especially if the house has appreciated significantly.

I'm not sure it's that simple. Most lenders don't hold the mortgage.
They are packaged and sold in the market. Whoever services them
doesn't particularly care what you do.


The new lender
will look at the appraised value versus the amount you want to borrow
and the PMI will be gone. Most lenders know this and thus *do* take
appreciation into account. I know this, because there was a time I did
it myself. I even refinanced with the same lender at a lower rate without
the PMI.


Dimitri

In article . com,
wrote:

That's unlikely to solve anything. The example he gave was a 200K
condo that had appreciated to $250K. In most of the US, that means he
very likely bought it not too long ago, like in the last 5 years, when
interest rates were likely lower than they are today. Refinancing to
a higher rate would likely more than negate the savings in PMI.


Maybe, maybe not.


Most lenders would rather not lose your business over PMI,
especially if the house has appreciated significantly.

I'm not sure it's that simple. Most lenders don't hold the mortgage.
They are packaged and sold in the market. Whoever services them
doesn't particularly care what you do.


This is one reason I give preference to companies that don't immediately
sell off the note.


Dimitri