Make Private Mortgage Insurance a Thing of the Past

For loans made since July 1999, lenders are obligated (by federal law) to automatically cancel Private Mortgage Insurance (PMI) when the loan balance gets below 78 percent of your purchase amount � but not when the borrower earns 22 percent equity. (A number of "higher risk" loan programs are not included.) The good news is that you can request cancelation of your PMI yourself (for a mortgage loan that closed after July '99), without considering the original purchase price, when your equity gets to twenty percent.

Verify the numbers

Study your monthly statements often. You'll want to stay aware of the the purchase prices of the houses that are selling around you. If your loan is fewer than five years old, probably you haven't made much progress with the principal � it's been mostly interest.

Proof of Equity

You can start the process of PMI cancelation at the time you you think that your equity reaches 20%. You will need to contact the lender to let them know that you wish to cancel PMI. Then you will be required to submit proof that you are eligible to cancel. You can acquire documentation of your home's equity by getting a state certified appraisal using form URAR-1004 (Uniform Residential Appraisal Report), which is required by most lending institutions before canceling PMI.

Curtis Mortgage LLC can help find out if you can eliminate your PMI. Give us a call: 610-565-3600.