Appraisal Needed to Remove PMI

[LP211316]

Hello there,

We're looking to remove PMI from our mortgage. We've had a few home improvement projects which includes shower rehab in our master bath and pool interior resurfaced/tiled. Contacted our lender and they advised that any upgrades to the home that cannot be moved justify a new appraisal to have PMI removed. Next year we will be having the lanai/deck surrounding the pool resurfaced, the roof replaced, tub and vanity in master bath upgraded.

My question is from an appraiser's perspective, would it benefit us to have an appraisal done now? In other words how much would the improvements we've already done improve our current value. I'd like it removed sooner than later. We've spent over $20k on the work done already.

I'm in Southwest Florida.

Thank you in advance for your insight.

 

[Meandering]

two things to consider before you make your own decision.

1. typical maintenance. If those things need to be done, based on age and previous condition of home, they may not improve any value expectation.

2. market conditions. As interest rates move up, typically fewer buyers can afford the higher prices that lower interest rates provided. However, the largeness of that market segment is highly impacted by the location of the property and if the typical buyers are very heavily reliant upon financing, or if the typical buyers, typically put down more than the minimum down payment and aren't going to fight with each other over a percentage or two difference in price.

3. So, you consider "timing the market" for expected interest rates, location, and not the "cost" of you fixing the property, but how much those fixes make it better than surrounding properties and sales.

.

 

[LP211316]

two things to consider before you make your own decision.

1. typical maintenance. If those things need to be done, based on age and previous condition of home, they may not improve any value expectation.

2. market conditions. As interest rates move up, typically fewer buyers can afford the higher prices that lower interest rates provided. However, the largeness of that market segment is highly impacted by the location of the property and if the typical buyers are very heavily reliant upon financing, or if the typical buyers, typically put down more than the minimum down payment and aren't going to fight with each other over a percentage or two difference in price.

3. So, you consider "timing the market" for expected interest rates, location, and not the "cost" of you fixing the property, but how much those fixes make it better than surrounding properties and sales.

.

Thank you. How much do comparables factor in? Recent sales in our neighborhood are obviously inflated due to current market, but I do believe home values have increased.

 

[Tim Hicks (Texas)]

The market is the market. Location, location, location. You are pretty much saddled with what the homes in your immediate neighborhood have sold in the past few months. The good news is if you have been in your home over two years, you probably have enough equity to remove PMI just due to market increases without updates to your home. Every neighborhood is different. Is it worth the cost of an appraisal to find out?

First, call you lender and see what they need. Some will accept an independent appraisal for PMI removal. Some will use other products to determine equity. Some may need to order their own appraisal. Every lender seems to handle it different.