by bogeysloop » Thu May 13, 2010 05:08 pm
I purchased a home in 2006, for 305K, it was worth over 600K...I have been paying a PMI since then...Should I have, since the value of the house is DOUBLE the amount of the loan? Do you think I am entitled to a refund?
Posted: Fri May 14, 2010 03:28 am Post Subject:
If the LTV ratio is <80%, the lender is not entitled to collect PMI. But it's generally up to the borrower to demand cessation of the coverage, it is not necessarily automatic.
However, if you purchased for $305,000 and the appraised value was $600,000+, PMI should never have been part of the discussion, and I would believe you are entitled to a full refund.
That's the concept of insurance, if there is nothing to insure, the contract is void and the premium must be refunded from the time it is void. PMI has slightly different language (as indicated above), but it is still subject to the general principle. Once you "prove" it is void, it is supposed to cease.
There's probably some case law on this, too.
Posted: Fri May 14, 2010 12:12 pm Post Subject:
Thank you Max...much appreciated.
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