Have equity in your home? Want a lower payment? An appraisal from Ruffino Appraisal Group, LLC. can help you get rid of your PMI.

It's generally known that a 20% down payment is accepted when purchasing a home. The lender's only risk is generally just the remainder between the home value and the sum remaining on the loan, so the 20% provides a nice buffer against the expenses of foreclosure, selling the home again, and typical value fluctuations in the event a borrower defaults.

Lenders were working with down payments dropping to 10, 5 and even 0 percent during the mortgage boom of the last decade. How does a lender handle the additional risk of the low down payment? The answer is Private Mortgage Insurance or PMI. PMI covers the lender in case a borrower defaults on the loan and the value of the property is less than what is owed on the loan.

PMI can be costly to a borrower on the grounds that the $40-$50 a month per $100,000 borrowed is bundled into the mortgage monthly payment and often isn't even tax deductible. It's favorable for the lender because they secure the money, and they get the money if the borrower doesn't pay, separate from a piggyback loan where the lender consumes all the costs.


The savings from dropping your PMI will make up for the price of the appraisal in no time. Nobody is more qualified than Ruffino Appraisal Group, LLC. when it comes to appreciating values in the city of Margate and Broward County. Contact us today.

How homebuyers can avoid bearing the expense of PMI

With the passage of The Homeowners Protection Act of 1998, lenders are required to automatically cancel the PMI when the principal balance of the loan equals 78 percent of the primary loan amount on most loans. Wise home owners can get off the hook a little early. The law pledges that, at the request of the homeowner, the PMI must be dropped when the principal amount equals just 80 percent.

It can take a significant number of years to arrive at the point where the principal is just 80% of the initial amount of the loan, so it's essential to know how your Florida home has grown in value. After all, any appreciation you've gained over time counts towards abolishing PMI. So why pay it after your loan balance has fallen below the 80% threshold? Your neighborhood might not conform to national trends and/or your home could have gained equity before the economy cooled off. So even when nationwide trends predict a reduction in home values, you should understand that real estate is local.

A certified, Florida licensed real estate appraiser can help homeowners figure out if their equity has reached the 20% point, as it's a difficult thing to know. As appraisers, it's our job to know the market dynamics of our area. At Ruffino Appraisal Group, LLC., we're experts at identifying value trends in Margate, Broward County, and surrounding areas, and we know when property values have risen or declined. When faced with information from an appraiser, the mortgage company will often remove the PMI with little trouble. At which time, the home owner can delight in the savings from that point on.


The money you keep from dropping the PMI required when you got your mortgage pays for the appraisal in a matter of months. Nobody is more qualified than Ruffino Appraisal Group, LLC. when it comes to appreciating values in Margate and Broward County. Contact us today.

Want to learn more about PMI and the Homeowners Protection Act? Click this link:

Cancellation of Private Mortgage Insurance: Federal Law May Save You Hundreds of Dollars Each Year