Make Private Mortgage Insurance a Thing of the Past

Although lenders have been legally obligated (for loans closed past July '99) to cancel Private Mortgage Insurance (PMI) when the mortgage balance goes below 78% of the purchase price, they do not have to cancel automatically if the equity is above 22%. (Some "higher risk" loan programs are excluded.) But you are able to cancel PMI yourself (for loans made after July 1999) when your equity rises to 20 percent, no matter the original purchase price.

Verify the numbers

Keep track of money going toward the principal. Also be aware of the price that other homes are purchased for in your neighborhood. You are paying mostly interest if your mortgage loan closed fewer than 5 years ago, so your principal most likely hasn't lowered much.

The Proof is in the Appraisal

At the point your equity has risen to the required twenty percent, you are close to stopping your PMI payments, once and for all. Contact your lending institution to ask for cancellation of your PMI. Next, you will be required to submit proof that you have at least 20 percent equity. A state certified appraisal using the appropriate form (URAR-1004 - Uniform Residential Appraisal Report) will be all the proof you need � and your lender will probably require one before they agree to cancel.

Executive Lending Group can answer questions about PMI and many others. Call us at 4056158543.

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Executive Lending Group

A Division of 1st Capital Mortgage LLC

2401 Tee Circle, STE 102B
Norman, OK 73069