Make Private Mortgage Insurance a Thing of the Past

While lending institutions have been legally obligated (for loans closed past July '99) to cancel Private Mortgage Insurance (PMI) when the mortgage balance goes under 78% of the purchase price, they do not have to take similar action if the loan's equity is over 22%. (This legal requirment does not cover some higher risk mortgages.) However, if your equity rises to 20% (no matter what the original purchase price was), you have the right to cancel PMI (for a loan that past July 1999).

Verify the numbers

Keep a running total of money going toward the principal. You'll want to be aware of the the purchase amounts of the houses that sell in your neighborhood. If your mortgage is fewer than five years old, probably you haven't made much progress with the principal � it's been mostly interest.

Verify Equity Amount

Once you think you've reached 20 percent equity, 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 payments. The lending institution will require proof that your equity is high enough. The best proof there is can be found in a state certified appraisal on form URAR-1004 (Uniform Residential Appraisal Report), which is required by most lending institutions before canceling PMI.

America's Money Source can help find out if you can eliminate your PMI. Call us: 4078987559.