Getting Rid Of PMI

by Chris
(Chicago, Illinois USA)

Ask Kate About Problems Getting Rid Of PMI: Hi Kate, I did a terrible mistake by sending $40,000 to my lender to get rid of my private mortgage insurance. Now the bank wants $95,000 to cancel the PMI.

Chris continues... I have my mortgage now for 19 months. I put down only 10 percent and have a PMI of $215.00 monthly. My lender said I can cancel PMI by paying down 80 percent LTV (ratio of loan to value) and current value of house.

So I sent a check of $40,000 to get 80 percent LTV. They required BPO (broker price opinion).

The BPO stated my unit is worth only 340k vs. the 463k purchase price. Now my LTV is 108.22 percent and they require me to pay down the principal to $272.

I cannot come up with $95,000.

I did a terrible mistake by sending the 40k check. I did not pay attention to the current value. I foolishly believe they would be happy to cancel PMI since I'm sending a big check to bring loan to 80 percent and have not missed a single payment.

What are my options? Do I have to wait until my property increased in value to get rid of PMI? It so disappointing that I payed down my original value 80 percent LTV but it was not good enough because property depreciated.

Now I'm afraid I have to pay $215.14 PMI for a very long time. I did a very stupid mistake which will cost me a lot money. The one thing it hurts the most is that I wanted to get rid of PMI but I prolonged it.

Kate Answers: Problems Getting Rid Of PMI

Dear Chris,

When I was a kid, we moved from Illinois to California in December. The ocean was cold but we were so excited and charged in. Distracted by the fun, we turned our backs and got whomped by waves. We never made that mistake again.

Chris, you just got whomped. And I doubt you'll ever send a lender $40,000 over a verbal promise again. But what should you do now?

In Writing In Writing In Writing

Ask for your money back. Don't sit on this. The longer the bank holds onto your money, the more they will think it belongs to them.

And never send a bank money without first getting an agreement in writing.

How Lenders Calculate PMI

I have also included more private mortgage insurance help later down this page such as How Lenders Calculate PMI.

Chris, one more thing. I'd like to hear back from you. Let me know how this turns out by Commenting here on Getting Rid Of PMI.

Or Ask Kate another question here.

Best wishes,

FINALLY! The PMI Answers You Need

What Is PMI - Could private mortgage insurance be your solution to equity and down payment problems?

Updates on HARP 2.0 Refinance with Borrower and Lender Paid Mortgage Insurance - PMI and LPMI.

You might not know this but you could be entitled to a mortgage insurance refund from FHA.

How do lenders calculate PMI? Credit history, amount of down payment or equity, occupancy status, and loan type contribute to calculations.

How Do I Cancel PMI Will refinancing or a new appraisal be required?

What to do if PMI Decision Making is getting in the way of refinancing or buying a house.

Ask Kate About PMI - Ask a question about PMI and get an answer from Kate.

My name is Kate and I will be your guide - PMI Questions and Answers

Here's where to comment on Problems Getting Rid Of PMI.

Here's where to Ask Kate a question.

Return to the home page of Get Your Best Mortgage Rate from Getting Rid Of PMI

Share Getting Rid Of PMI

I depend on your word of mouth! So please help me spread the word about My Problems Getting Rid Of PMI with your friends using these easy buttons.

The information you obtain at this site is not, nor is it intended to be, a substitute for financial, real estate or legal advice. You should consult an attorney, accountant, lender or real estate agent, as applicable, for advice regarding your individual situation. Comments and opinions found here are not necessarily those of Get-Your-Best-Mortgage-Rate.com