Legal Question in Banking Law in Indiana

Dropping my PMI

I was told at closing that when I reached 80%LTV(based on the appraisal)I could drop my PMI and the escrow for my mortgage. Two years later I satisfy the 80% then they tell me it is based on the purchase price. I satisfied that and now after turning in and faxing 5 signed letters-two months later neither the pmi or escrow are dropped. Is there a legal time limit on how long they can take?

Asked on 6/25/03, 5:17 pm

1 Answer from Attorneys

John Bator Bator Redman & Shive

Re: Dropping my PMI

I assume from your description that there is nothing in writing regarding the 80% loan to purchase price "agreement". If so it may not be enforceable. I suggest calling your original loan officer (if still there) and asking for his or her help. You can always threaten to or file a complaint with the Indiana Department of Financial Institutions-the mere threat may get them to respond and get you to the right department or person. Of course, unless there is a prepayment penalty, you can refinance with another lender who will not require PMI and you may qualify for a lower rate. Another option is hiring an attornet to write the lender and threaten legal action as well as a complaint with the DFI-this mat be the least expensive route and may get the quickest reply. Good Luck.

John E Bator

Bator Redman


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Answered on 6/26/03, 11:19 am

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