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How to Get Rid of That Damn Mortgage Insurance That You’re Paying Each Month…
In most cases, If you have a mortgage, and you did not put at least 20% down when you bought the home, chances are that you do have private mortgage insurance (PMI). On a $300,000 home, for example, you could be paying an extra $125 every single month in Private Mortgage Insurance. That’s $1,500 a year that you are losing!
Private Mortgage Insurance is there to protect the mortgage lender in case you don’t make your payments. If you stopped making payments, the mortgage insurance company would step in and pay the lender… and you are footing the bill for these insurance premiums.
So how the hell do you get rid of mortgage insurance? It’s usually pretty simple…
-Pay your mortgage down to 80% of what your home is worth. In other words, you need at least 20% equity in your home. You can do this one of two ways…
1) Keep making your payments until you have 20% equity
2) Your home can go up in value. Depending when you bought your home, and what your local real estate market has done, you may already have the 20% equity needed to eliminate PMI.
If you have at least 20% equity in your home, (and your loan program allows PMI to be dropped,) you can request IN WRITING that your lender remove the mortgage insurance. Of course you’ll have to prove that you do indeed have 20% equity. You’ll need to show that your home is worth what you say it is.
The bank will require that you get an appraisal, which you’ll have to pay out of pocket. But make sure you reach out to a top real estate agent in your area and have them value your home for you for free. It doesn’t make any sense to go pay for an appraisal unless you are very confident that your home is worth enough.
If you live in the Salt Lake City area, our real estate team can provide you with a free market analysis for your home. Call Dustin Brohm at 801-455-8753 or email firstname.lastname@example.org for more info.
*Video courtesy of Dustin Brohm’s Snapchat Story – follow Dustin on Snapchat @ dustinbrohm
**Dustin Brohm is a Top Salt Lake City Realtor, Smart Home Expert, and the Founder of