Make Private Mortgage Insurance a Thing of the Past
While lending institutions have been obligated (for loans closed past July '99) to cancel Private Mortgage Insurance (PMI) at the time the loan balance dips under 78% of the price of purchase, they do not have to cancel PMI automatically if the equity is more than 22%. (Some "higher risk" loans are excluded.) The good news is that you can cancel your PMI yourself (for your loan closing after July '99), no matter the original purchase price, when your equity rises to twenty percent.
Keep track of payments
Familiarize yourself with your mortgage statements to keep your eye on principal payments. Find out the selling prices of other homes in your immediate area. You are paying mostly interest if the closing was fewer than 5 years ago, so your principal probably hasn't gone down much.
Proof of Equity
You can begin the process of PMI cancelation as soon as you're sure your equity reaches 20%. You will first let your lender know that you are requesting to cancel PMI. Then you will be asked to verify that you are eligible to cancel. The best proof there is can be found in a state certified appraisal on form URAR-1004 (Uniform Residential Appraisal Report), required by most lenders before canceling PMI.
Alternative Mortgage Group can help find out if you can eliminate your PMI. Give us a call at 561-395-4264.