For loans closed after July 1999, lending institutions are required (by federal law) to automatically cancel Private Mortgage Insurance (PMI) when the balance of the loan gets lower than 78 percent of the purchase amount � but not at the point the borrower achieves 22 percent equity. (Some "higher risk" morgages are not included.) The good news is that you can request cancelation of your PMI yourself (for your loan that closed after July '99), regardless of the original purchase price, after your equity reaches twenty percent.
Do your homework
Analyze your statements often. Also stay aware of what other homes are being sold for in your neighborhood. You are paying mostly interest if you closed your loan fewer than 5 years ago, so your principal probably hasn't lowered much.
The Proof is in the Appraisal
When you determine you've achieved at least 20 percent equity, you can begin the process of freeing yourself from PMI payments. You will need to notify your mortgage lender that you want to cancel PMI payments. Your lender will request documentation that your equity is at 20 percent or above. A state certified appraisal using the appropriate form (URAR-1004 - Uniform Residential Appraisal Report) will be all the proof you need � and your lender will probably request one before they agree to cancel PMI.
CHASE MORTGAGE INC #317430 can help find out if you can eliminate your PMI. Call us: 435-755-6622.