EDS MORTGAGE

Expert Dedicated Service • Buena Park, CA

Looking For Something?

  • Home
  • About
    • About Us
    • Mission Statement
    • Privacy Policy
  • Blog
  • Resources
    • First Time Home Buyer Tips
    • First Time Home Seller Tips
    • Closing Costs
    • Home Appraisal
    • Home Inspection
    • Loan Checklist
    • Loan Process
    • Loan Programs
    • Mortgage Glossary
    • Mortgage FAQ
  • Online Forms
    • PDF Application
    • PDF Application – EspaƱol
    • Appraisal/Credit Report Credit Card Charge Authorization
    • Borrower Certification & Authorization
    • Credit Report Authorization
  • Apply Now
  • Reviews
    • My Reviews
    • Write a Review
  • Contact Us

February 9, 2021 by Celia Cohen

An Overview Of Private Mortgage Insurance

An Overview Of Private Mortgage InsuranceWhen you are going through the process of looking for a new home, you are probably focused on the sticker price of that home. Even though it is important to think about your down payment, your monthly mortgage payment, and the total amount of the loan, there are other expenses that you might need to cover as well. If you do not put down enough money, there is a chance that the lender could ask you to pay for something called private mortgage insurance. What is private mortgage insurance and how much do you have to pay? There are several important points that you should keep in mind.

Why You Might Purchase PMI

Private mortgage insurance is something that the lender may ask you to purchase as a way to reduce their risk. If you do not make a sizable down payment, then the lender is responsible for funding most of the cost of your home. If you end up defaulting on the cost of that loan, the lender will lose a major amount of money. With PMI, the lender will be able to get his or her money back in the event that you default. Even though the exact cost of PMI will vary, you should expect to pay somewhere between 0.5 percent and 2 percent of the loan. You might be able to ask the lender to check with multiple options to find the least expensive policy possible for you. Once the PMI policy is instituted, this is something that you will have to pay on top of your monthly mortgage payment.

Avoiding PMI Payments

Importantly, there are ways that you can avoid PMI. You might be able to avoid this insurance policy altogether if you are able to increase the size of your down payment. If you cannot do that, the PMI policy will usually be canceled when you reach a certain threshold in equity. This is something that you should negotiate with the lender before you sign on the dotted line. In some cases, the PMI policy as waved when you reach 10 percent of the loan amount paid back. Even though you should check with a professional accountant, PMI is likely tax-deductible, similar to mortgage insurance.

 

Filed Under: Mortgage Tagged With: Insurance, Mortgage, Mortgage Payments

  • 1
  • 2
  • 3
  • …
  • 6
  • Next Page »

Contact Us

celia
CELIA C COHEN
celiacohen@aol.com
Phone: (562) 884-5952
Office: (562) 210-8629
Company NMLS#: 1751542 • Personal NMLS#: 1567974
DRE#: 01057793

APPLY TODAY  
GET A RATE QUOTE  

Connect with Us

How can we help?

  • This field is for validation purposes and should be left unchanged.

Categories

Recent Posts

  • 7 Inexpensive Upgrades You Can Make To Your Rental Property
  • What’s Ahead For Mortgage Rates This Week – April 19, 2021
  • NAHB: Home Builder Confidence Ticks Up in April
  • It’s Almost Spring Cleaning Time! Kick Clutter To The Curb With These Home Cleaning Tips
Equal Housing Lender

Archives

Location


5811 BEACH BLVD
BUENA PARK, CA, 90621

Copyright © 2021 · Generate Pro on Genesis Framework · WordPress · Log in