PMI question

iVillage Member
Registered: 12-05-2004
PMI question
4
Wed, 01-12-2005 - 2:54pm


I have a question about PMI (Private Mortgage Insurance). When we bought our house, we took out a mortgage for 158,000. Until we have paid 20% of that amount (bringing our mortgage balance down to $126,400), we have to pay PMI with our house payment each month. Our current balance is 137K, but I have heard that there is a way to stop paying PMI if you have your home reassessed for current value. Homes in my neighborhood are currently going for around $200K. Does anyone know how this works? I would love to avoid paying that PMI and have a little extra "snowflake" this year. :-D

Pat

iVillage Member
Registered: 04-29-2003
Wed, 01-12-2005 - 4:02pm

Talk to your mortgage company...usually you have to have a full appraisal. That is around $300-$500 in my area. Some companies might let you get by with a quickie or drive by appraisal - about half the cost here. Other companies may only let you get an appraisal by a 'preferred' company or invidual (this seems to be rare). Any option, get in writing so that they can't come back and say you did the wrong one, and have to pay for another appraisal.

Good Luck

Avatar for cl_phocid
iVillage Member
Registered: 03-26-2003
Wed, 01-12-2005 - 7:38pm
Hi Pat - Sola Rae is correct.

All my best,
Danni

iVillage Member
Registered: 04-07-2003
Wed, 01-12-2005 - 7:50pm
You should also check your Mortgage contract. I have a FHA loan and have to pay PMI for 5 years regardless if I reach the 20% equity.
iVillage Member
Registered: 03-29-2003
Wed, 01-12-2005 - 8:48pm

On our mortgage we could pay a fee, $85 I think and ask the mortgage company to reevaluate for PMI. If you have 20 percent equity based on the original appraisal they shouldn't need to do another. OK I looked at your numbers again and if you put 5% down, then your current balance would need to be around 132,720 to qualify based on your original appraisal. But, if you put down 10% you have already met your 20 percent amount.

So, check your original appraisal and talk with your mortgage company. Another option depending on interest rates would be to refinance. With a refi you would get a new appraisal anyway. Depending on your interest rate this may or may not be a viable option.

That will create a nice snowflake every month.