🛑 How To Remove PMI Early! #shorts

When you purchase a home with less than 20% down, your lender will typically require you to pay “private mortgage insurance” a.k.a. PMI in case you default on your loan (stop paying).

💸 This adds up to a few hundred dollars a month that goes straight to the bank instead of towards paying off your home!

Normally, banks will automatically remove the PMI after a few years when your payment schedule gets you to the 20% equity mark.

But if you purchased your home in an area that has seen high appreciation, you may be able to remove your PMI early!

🏡 The first thing that you have to do, is check how much your home is currently worth (you can use Zillow as a good place to start).

If the difference between the current value and your loan amount is over 20% of the current value, then you can get your PMI removed.

As an example, let’s say you purchased your home for $300,000 with 10% down. This means your loan is $270,000 and you have $30,000 in equity (from your down payment).

📈 But after a few years, the value of the home increased to $350,000... Now your equity is $80,000 (not including any equity you gained from paying off the loan over the past few years)! This brings your equity to over 22% ($80K/$350K)

Once you hit this mark, contact your lender and ask them to remove the PMI from your loan early. They’ll probably ask you to pay for an appraiser (around $700) to verify the value of the property.

But once that’s done, your PMI will be removed and you’ll save a few hundred every single month going forward!

💰 Which is money that you can put back in your own pocket to start investing more and building generational wealth.

#realestate #mortgage #interestrates

[gustavobarrera]

This only works if you got a conventional loan not with an fha loan.

[grizz]

1. most loans have a clause that this will require refinancing which with todays economy will most likely mean a higher interest rate
2. you are also often forced to use and pay for a appraiser that is approved by the mortgage company. This can be more costly then just paying the PMI or paying the mortgage early to get under 20%.
3. The city will also get the new appraisal meaning higher taxes further off setting the savings

[sambuechel]

This is the 1st solid advice he has actually given

[ELSAMRAS]

This is only if you’ve been in property for minimum of 2 years. Otherwise you have to refinance to get that pmi gone, or pay the 20%

[FortniteIStheBOMB]

Your a genius thank you for being awesome have a great day!

[METVWETV]

When I did this (many years ago) I actually had an argument on my hand with the bank!

Mind you, I did the Comps and knew I was good!

I still recall how nasty the rep was, literally huffing and puffing while I insisted that I wanted to move forward with a new appraisal, which the bank charged me for.

You'd think she owned the bank!
To this day I don't understand her annoyance?!

[GRIMRPR]

Theres some downside to doing this. First you have to pay for a third party appraisal. If you have an FHA loan, it has to be converted to a conventional. And now your paying higher property taxes on the new higher value assessment. And what happens when your property value stays flat or drops? Please do your homework people!

[lonnieparker]

Thanks Sean. I learned this trick from you and it worked! Keep

[nastassianovikava]

im watching this as a kid but im trying to understand so i can have a good life thank you for teaching me

[-Sere-]

reappraisal for higher amount? Higher property taxes! good job!

[Thedividendprojectt]

Throw that money you paying to PMI into dividend stocks like VIG and DGRO!

[otbaht]

I did the same. It didn't quite get to 20 percent but i should be getting pmi off soon. i think 3 more months.

[seanlovesrealestate]

✅ If you want to learn more about real estate investing, then check out my FREE Rental Masterclass with the 🔗link.

[Chris.Brisson]

I was told PMI could not be removed during the first two years.

[WorldinRooView]

I'm sure the bank didn't tell the government about that reappraisment so that you're paying more in property taxes ;P

[mr.s]

Except then your taxes go up...which won't go back down...don't ever opt to let assessors in

[megatar]

Hmm… so you if you buy a property you intend to renovate in the first couple months, could you get it re-appraised right after renovations to reach this 20%?

[DanielSilvafinance]

Do you have to pay for an appraisal in order the get your home reappraised?

[miyagivictor]

I tried that with freedom mortgage and ended up having to refinance. Got a lower rate through rocket though.

[leonable]

I got my mortgage reduced to $0.00 after 5 years. Payed it off