Mortgage Insurance early removal?

Question

A friend bought a place with 5% down. A recent appraisal says the home is worth significantly more, so his remaining balance is below 20%. Is there an inexpensive way to get the PMI removed?

Chris Mason · Answer

Only thing I'll add to the already correct answers is not to try and save $150 by getting a drive-by appraisal or BPO. Get a real appraisal. The cheapo appraisal alternatives will not capture the value added by your friend's diligent care of (and/or improvements to) the interior of the home, so a home might appraise at $500k but BPO/drive-by at $425k (what would you assume the inside of a home looks like, if I told you that 123 Main St was great, but refused to let you inside to see for yourself?).

Jeff Dulla · Answer

@Amanda Gust How long ago did he buy it?

Yes - call the servicer and ask them to cancel the PMI. Provide the appraisal. They may want to do their own though.

Jeff Dulla · Answer

@Amanda Gust The PMI cancellation is controlled by the servicer and each servicer can have minimum time requirements. Some have no time requirement. But most I have seen run six months to two years after purchase. So it sounds like he may be in a good spot.

Good luck!

Dave Skow · Answer

agree with previous posts .... to add :   * the  appraisal fee  will need to be paid for by your friend  ( $400-$700).....follow the servicers  instructions  on the steps to  remove the mtg ins ........if for some reason the servicers refuses to provide any options  , another method  to eliminate the mtg ins would be to  refinance the loan

Amanda G. · Answer

He bought it a little over 2 years ago, it was an estate purchase. I will follow up with his servicer. Thanks so much!

Mortgage Insurance early removal?

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