PMI is Finally Removed!
Posted on | April 20, 2014 | No Comments
After months of following up with Bank of America, I was finally able to convince them that they should no longer be requiring PMI for my loan. You can read more on my thoughts on PMI here.
I’ve been rounding up my mortgage payment up to the next $50 for a while now. This is to reduce the overall interest I’ll be paying over the life of the loan. I also wanted to reduce the amount owed so that I could remove PMI. My monthly payment was $123.50 of which there was absolutely no benefit to me. I suppose maybe if I chose to default on the loan BofA would have continued getting paid on the loan and I could have held on to the property a little longer before it went to foreclosure and kept receiving rental income. Maybe that would have worked, I don’t know.
However, I wanted PMI removed which would reduce my monthly expenses.
I kept calling BofA asking if the PMI could be cancelled because the balance on the loan was down to 76% of the value it was appraised at when I purchased it. They kept on saying that they would submit the request and a month later I would get a generic form asking me to pay for an appraisal. The cost would have been a couple hundred dollars and then a decision would have been made. I did not want to pay for the appraisal and then have BofA tell me that due to recent market conditions the property had dropped in value and PMI could not be cancelled.
In April after many inquiries they finally reduced the PMI. I’m not sure how they were able to do this but they brought it down to about $30 a month. I was a bit annoyed that I had been paying $90 more and suddenly they could just reduce it. I was happy about the reduction but still needed it dropped completely.
Finally in May, according to the original loan schedule, my balance would have dropped below 80%. So, I called BofA in April to let them know that the May statement was incorrect. I let them know that the PMI was required to be “automatically terminated” because of the loan schedule. Additionally, I had them review the Truth In Lending document that I signed. The truth in lending documented stated that I would be making 123 payments at 1203.30 and then 236 at 1078.80. I explained to them that the difference in payment was PMI in the amount of 123.50. They stated that they would still have to submit the request to the “investor.” On April 8th, they finally sent me a letter stating that PMI was no longer required on my loan and that any over charges would be refunded to me.
It felt great to finally have it removed! Now that PMI is removed, I’ll refinance the loan.
Here is a link for more information regarding Request PMI cancellation and Automatic PMI termination here.
Have you tried to get PMI removed from your mortgage? What was your experience?
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