Real Property

Awareness Can Save on PMI

Are you paying for private mortgage insurance (PMI)? If, like as many as 30% of putting down at least a 20% down payment, you're probably paying for PMI every month‑‑and could go on paying it for the life built up sufficient equity in the property, however, you may no longer need PMI and can save yourself $25‑$75 a month‑‑and maybe more.

Most lenders make PMI a condition of the loan, to protect themselves in case borrowers property for less than the outstanding balance. But if you've built up 20% equity in the home‑‑that is, if the balance of the loan is value‑‑then the lender is probably no longer at risk, and you can ask that the insurance be dropped.

To prove what the property is now worth, you may need to pay a few hundred dollars well spent.