Eliminating Private Mortgage Insurance

For loans made since July 1999, lending institutions are required (by federal law) to automatically cancel Private Mortgage Insurance (PMI) when the loan balance goes under 78 percent of the purchase amount � but not when the borrower achieves 22 percent equity. (This legal obligation does not include a number of higher risk mortgages.) However, if your equity gets to 20% (regardless of the original price of purchase), you have the legal right to cancel PMI (for a mortgage loan that past July 1999).

Verify the numbers

Familiarize yourself with your monthly statements to keep a running total of principal payments. Find out the prices of other houses in your immediate area. If your mortgage is fewer than five years old, it's likely you haven't made much progress with the principal � you have been paying mostly interest.

Proof of Equity

Once you find you have reached 20 percent equity in your home, you can start the process of canceling your Private Mortgage Insurance. You will first notify your lender that you are requesting to cancel your PMI. Your lender will request documentation that your equity is high enough. Most lenders require a state certified appraisal documented on the form: URAR-1004 (Uniform Residential Appraisal Report) to determine your equity and eligibility for canceling PMI.

CHASE MORTGAGE, Inc. #317430 can help find out if you can eliminate your PMI. Give us a call: 4357556622.