PMI Avoidance
My wife and I have been told that if we invest below 80% on a LIBOR based mortage we must pay PMI insurance. We would like to get 95%-!00% borrowed/LTV.
Question,
1 - For every 100K what is the estimated PMI rate?
2 - Is there a way to pay a cheap PMI ( or must I purchase this from the lender)? Or is there a way to avoid it all together?
Thank You.
iaustin
Austin;
1.) As a general rule any conforming loan with financing above 80% of the value of the home will require PMI. Ask your broker / Bank as some offer program that you can "buy out" PMI by rasing the interest rate... it will generally equate to the same payment as a lower rate with PMI the difference is that PMI is not tax deductable..
2.) To calculate PMI- it will depend on what LTV (loan to value) you are going the higher the loan to value to more risk to the bank and the higher the PMI premium.
Here is the PMI Groups website.. with a calculation page
https://www.e-pmi.com/RateQuote.html
Good luck
-Daniel
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"Banks are very user friendly...they are just picky on who they call friends "
[ Edited by JohnLocke on Date 06/20/2004 ]