Today, there are a lot of buyers that have 20% down payments when walking to the real estate purchasing plate. In fact, we are seeing that there are cash buyers that are intending on being owner occupants, buying homes in the Santa Clarita Valley.
Both of those scenarios do not have PMI aka Property Mortgage Insurance attached with them. The Cash Deal does not because there is no loan in place. The property is bought with cash and owned by the new owner outright.
Here is a scenario. You purchase a home with an FHA loan in the Santa Clarita Valley. The down payment required is 3.5%. Let's say the home costs $400,000 - with an FHA loan that would require you to put a down payment of $14,000.00. A few years rolls by and your home increases in value. If the value of your home has achieved 20% equity - $480,000.00 - then you are in a pretty good spot to have the PMI waived. In order to do this, it's not magic - contact your bank and check with them regarding that process. It maybe that some won't, some will, but most have procedures in place to do this very thing.
Why is removing PMI something that is worth trying - Because, you could be paying anywhere between $50.00 bucks a month to $300.00. That is a couple more movies or nice dinners :)
Here was an excellent article about Real Estate Lending's PMI by Scott Wilson, a TOP Real Estate Reporter with the Los Angeles Times, who breaks down PMI, what it is and why you should care if you own a home with less than 20% equity.
Paris911 Real Estate Update
Yesterday we completed our Santa Clarita real estate intelligence reports via the independent research company where we obtain the freshest and "un scrubbed" real estate data from our clients.
We also broke down the numbers for Single Family Residences in each of the Santa Clarita Valley Cities. Those numbers seem to be on tract - flat in some areas, and increasing in others. Overall the real estate prices are up due to the lack of homes for sale that are truly available.
Take note I said "truly available". This needs to be pointed out due to some agents not keeping with their fiduciary duty to their seller with keeping the Multiple Listing System updated with the property's most current status. It could be that they are doing this on purpose, keeping a listing showing active to generate more leads. A tactic often used by a "not above board Realtor" when a property has an accepted offer that has been signed off by the seller. It could also be that the listing was placed into Back Up offer status in order to have it rendering as "active" on some of the real estate syndication websites, when the seller does not want a back up offer or already has that component of the home selling process fulfilled.
Earlier this AM - I'm writing this text at 0507hrs - I just completed the recon reports for Condo's and town-homes in the Santa Clarita Cities. Please click through twice on each link to gather the full recon and to see the PDF formatted reports. Where are we with condo's and town-homes in the Santa Clarita Valley?
Be safe - please subscribe to our real estate intel - only every couple of weeks we enter your life and give you the Real Estate Recon in a video or text presentation. It's more than enough and will have you more "aware" than some that are in the Real Estate business full time :)