I purchased a home in 2006 with 10% down which included PMI. Mortgage was 5/1 Arm and PMi was $225 per month. At the end of the 5 years I reviewed the mortgage to see if I could refinance or get a better deal, I questioned the mortgage holder then Indymac Bank regarding the PMI as I felt I had no need to continue paying it at that rate.
I put it in writing why, I was basing my information on the AS (amortization schedule)they gave me, intially LTV was 90%, during the last 5 years I never paid the amount they asked I paid it as a full principal and interest payment. If I had paid the low amount requested the LTV goes up to 103% at the end of 5 years, at the end of 10 years it goes down to 94% LTV, after 10 years paying $225 it then drops to $57 for the next 5 years.
As I have paid it as a straight P&I mortgage my LTV has never been above 90% (currently it is about 83%), I asked them to consider reducing the PMI or cancelling it, they wrote back eventually, saying they couldn't, so I wrote back with a detailed letter describing why I felt this was unfair practice, they still refused, saying send us $23k and we will waive the PMI, spend $300-400 on an assessor/valuer they approve and if the value of the house has gone to $425-430k we may then consider it, I suggested it was unfair the valuation side, as I said can you tell me anyone who has bought a house not foreclosure in the last 5 years whose home value has gone up? Even though we have spent around $60-70K in improvements to the home which cost $385K, it still won't value in this market for the $425k+ they request. According to the AS month 61 we should now owe $391,000 on our mortgage, we actually owe $321,229 which is payment month 167, so we are 106 monthly payments ahead of our mortgage, never missed a single payment, never late and they still refuse to play fair.
This is a scam of the highest order to me, I have sent letters to ask politely, set out my case in simple terms and they just refuse to change their payments, can anyone help I imagine an awful lot of other people are suffering with this issue and is probably contributing to the home foreclosures, something must be done to stop this practice.
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