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Private Mortgage Insurance

DougK62

DougK62

Diamond Member
I purchased my house about 5 years ago. I put ~7% down on a 30 year note, so I got stuck with a PMI payment every month. I've made all of my payments on time and my account is in good standing. I'm not up to the 20% value in the home that's required for PMI to be knocked off, but I'm just tired of throwing that money away every month. I think I've proved that I'm not a deadbeat borrower. My plan is to call my mortgage holder and ask to have my PMI payment removed because I've been such a good borrower. Hah! Any chance that this will work? Has anyone done something similar? Any strategies?

 
Originally posted by: Ocguy31


It was for 2008...
Click to expand...

Yeah, just googled. And there are income strings attached to it which may make a piggyback loan more advantageous.

And it is only for homes purchased/loans made during 2007.
 
good question, probably no though...

Our place is worth 130k apparently, and we only owe 100k...I wonder if I could get it knocked off now??
 
Originally posted by: ViviTheMage
good question, probably no though...

Our place is worth 130k apparently, and we only owe 100k...I wonder if I could get it knocked off now??
Click to expand...

You could and should.
 
Originally posted by: GTKeeper
Originally posted by: ViviTheMage
good question, probably no though...

Our place is worth 130k apparently, and we only owe 100k...I wonder if I could get it knocked off now??
Click to expand...

You could and should.
Click to expand...

condos seems to be going up in price here, woot! Almost 2 years and we originally put 0 down 😀...

Would I need to refi, or just say--knock that PMI shit off?
 
It worked for me.

I had purchased a townhouse in 2004 with 0% down. In 2007, after paying down about 15% of the balance (I made extra payments when I had extra money), I asked if I could have the PMI removed. I hadn't paid down 20%, but I was always on time and usually had some extra.

Please note: My mortgage was through a credit union, YMMV.
 
Originally posted by: BurnItDwn
It worked for me.

I had purchased a townhouse in 2004 with 0% down. In 2007, after paying down about 15% of the balance
Click to expand...


That is because home values were still rising. You owed less than 80% of your home's value if you paid down 15% of the balance.
 
Originally posted by: Ocguy31
Originally posted by: BurnItDwn
It worked for me.

I had purchased a townhouse in 2004 with 0% down. In 2007, after paying down about 15% of the balance
Click to expand...


That is because home values were still rising. You owed less than 80% of your home's value if you paid down 15% of the balance.
Click to expand...

That is not totally accurate.
The value did rise in 2005 and 2006, but in 2007 the value had fallen to 2004 levels.
I moved out of there in Nov 2007 after it sat on the market for close to 4 months. It sat on the market for 4 more months before I finally closed on it, and sold it for $500 LESS than my purchase price.
 
Can you have your home re-appraised? Maybe with falling prices, you have already paid the 20%.
 
Originally posted by: RKS
Can you have your home re-appraised? Maybe with falling prices, you have already paid the 20%.
Click to expand...

OP, I would look into this suggestion. It is most likely your best bet.

You have little chance considering how strict the banks are being these days unless you do things by the book. Still, I am a man who believe that the answer is "No" until you ask so I say go for it regardless.
 
Originally posted by: spidey07
Originally posted by: Ocguy31


It was for 2008...
Click to expand...

Yeah, just googled. And there are income strings attached to it which may make a piggyback loan more advantageous.

And it is only for homes purchased/loans made during 2007.
Click to expand...

I looked into an 80/10/10 versus a standard 30 year fixed with 10% down. Even with the income limits on deducting PMI on fed income taxes I was still better off taking the standard loan based on the rates I was given at the time. You really have to look at it both ways. The nice thing about the piggyback loan is that you build more equity in your home sooner (while you are paying on both loans).

I understand not wanting to pay PMI. However, PMI is the price you have to pay to get the loan you did. Without PMI, fewer people would be able to afford to buy a home, or would have to delay until they had 20% down. Some would say this is a good thing...

 
Originally posted by: RKS
Can you have your home re-appraised? Maybe with falling prices, you have already paid the 20%.
Click to expand...

I don't understand this. If the prices have fallen, wouldn't he owe a higher percentage of the value (he would have lost equity)?

Example:

House price: $100,000
Original Downpayment: $7,000
Equity: 7%

After 60 months of payments at 5.3%, 30 year amortization, 12 compounding periods per year, 12 payments per year.

Principal: $85,757
Home Value: $90,000 (10% decline)
Equity: $4,243 (4.71%)
 
Originally posted by: D1gger
Originally posted by: RKS
Can you have your home re-appraised? Maybe with falling prices, you have already paid the 20%.
Click to expand...

I don't understand this. If the prices have fallen, wouldn't he owe a higher percentage of the value (he would have lost equity)?

Example:

House price: $100,000
Original Downpayment: $7,000
Equity: 7%

After 60 months of payments at 5.3%, 30 year amortization, 12 compounding periods per year, 12 payments per year.

Principal: $85,757
Home Value: $90,000 (10% decline)
Equity: $4,243 (4.71%)
Click to expand...

good point. that's why I am not an accountant/finance guy. Hey OP see if you have made any improvements to raise the value of your house?

 
Originally posted by: RKS
Originally posted by: D1gger
Originally posted by: RKS
Can you have your home re-appraised? Maybe with falling prices, you have already paid the 20%.
Click to expand...

I don't understand this. If the prices have fallen, wouldn't he owe a higher percentage of the value (he would have lost equity)?

Example:

House price: $100,000
Original Downpayment: $7,000
Equity: 7%

After 60 months of payments at 5.3%, 30 year amortization, 12 compounding periods per year, 12 payments per year.

Principal: $85,757
Home Value: $90,000 (10% decline)
Equity: $4,243 (4.71%)
Click to expand...

good point. that's why I am not an accountant/finance guy. Hey OP see if you have made any improvements to raise the value of your house?
Click to expand...

If the value of your home rises, you can have it re-appraised. The rise in value will be counted towards equity in your home and you can have PMI removed. You have to check with your lender though... my lender won't let me do this for at least 4 years and I have to show that I have 22% of the loan value in equity in the house.

R
 
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