Monday, May 6, 2024

Private Mortgage Insurance

Over the last few years, the cost of buying a house has skyrocketed.  One silver lining to this sharp increase is that more existing homeowners paying for Private Mortgage Insurance (PMI) are eligible to have it canceled, translating into one, two, or more, hundred dollars of savings each month.   PMI should be automatically removed when your LTV (Loan-To-Value) ratio drops to 78%.  Still, you depend on your loan's servicing company to keep that calculation current, which is not in their best interests.  So it's best to check your monthly mortgage statement for your remaining loan balance and online estimates of your house's value (e.g. Zillow) and see if you're down to 80%, the point where you can request PMI cancellation, which will likely require a formal appraisal, or way below 80% which should be a no-brainer (emphasis on "should").

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