Make Private Mortgage Insurance a Thing of the Past

For loans closed since July 1999, lenders are required (by federal law) to automatically cancel Private Mortgage Insurance (PMI) when the balance of the loan gets under 78 percent of your purchase price � but not at the point the borrower earns 22 percent equity. (There are some loans that are not included -like some loans considered 'high risk'.) The good news is that you can request cancelation of your PMI yourself (for a mortgage loan closing after July '99), without considering the original purchase price, at the point your equity climbs to twenty percent.

Verify the numbers

Familiarize yourself with your loan statements to keep your eye on principal payments. You'll want to stay aware of the prices of the homes that are selling around you. You are paying mostly interest if you closed your loan fewer than 5 years ago, so your principal probably hasn't lowered much.

Verify Equity Amount

You can start the process of canceling PMI when you're sure your equity has reached 20%. First you will notify your lender that you are asking to cancel your PMI. Next, you will be asked to submit proof that you are eligible to cancel. You can get documentation of your home's equity by getting a state certified appraisal using form URAR-1004 (Uniform Residential Appraisal Report), required by most lenders before canceling PMI.

Stepping Stone Mortgage can help find out if you can eliminate your PMI. Give us a call at 5416833300.