Eliminating PMI - Trinity Funding, Inc.

Eliminating Private Mortgage Insurance

For loans made after July 1999, lenders are required by federal law to automatically cancel Private Mortgage Insurance (PMI) when the loan balance falls below 78 percent of your purchase price — not when you achieve 22 percent equity, which will happen much more quickly with rising property values. (Certain "higher risk" loans are excluded.) But you have the right to cancel PMI (for loans made after July 1999) once your equity reaches 20 percent, regardless of the original purchase price.

Keep track of your principal payments. Also keep track of what other homes are selling for in your neighborhood. If your loan is under five years old, chances are you haven't paid down much principal — it's been mostly interest. But property values in many parts of the country have gone through the roof lately. And that can earn you 20 percent equity even if you haven't paid down much principal.

When you think you've reached 20 percent equity in your home, you can begin the process of freeing yourself from PMI payments! You will need to notify your mortgage lender that you want to cancel PMI payments and you'll need to submit proof that you have at least 20 percent equity. A state certified appraisal on the appropriate form (URAR- 1004 uniform residential appraisal report for single family homes) is the best proof there is — and most lenders require one before they'll cancel PMI.

Peter Ma is licensed under the laws of the State of Texas and by State Law is subject to Regulatory oversight by The Department of Savings and Mortgage Lending, any consumer wishing to file a compliant against Peter Ma should complete, sign, and send a complaint form to The Department of Savings and Mortgage Lending, 2601 North Lamar, Suite 201, Austin, Texas 78705. Complaint forms and instructions may be downloaded and printed from the Department web site located at www.sml.state.tx.us or obtained from the Department upon request by mail at the address above, by telephone at its toll-free consumer hotline at 1-877-276-5550, by fax at (512)475-1360, or by e-mail at smlinfo@sml,state.tx.us.

The Department maintains the mortgage broker recovery fund to make payments of certain types of judgements against a mortgage broker or loan officer. Not all claims are compensable and a court must order the payment of a claim from the recovery fund before the Department may pay a claim. For more information about the recovery fund, please consult Subchapter F of The Mortgage Broker License Act on the Department's web site referenced above.