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10% down, conventional, no PMI, should I do it?

I am considering locking in a rate of 4.58% for a 30 year loan on 340,000. NO PMI but instead I pay about 5k to a PMI company at time of closing to avoid it. The 5k can be financed in the loan. My median credit score is 747 and my wife's is 793. is this a good rate? seems like a good deal to pay the 5k to avoid PMI but anyone have any advice related to this? by rdeans_673_511 from New Orleans, Louisiana. Aug 10th 2011 Reply


Gregorio Denny (GVDenny)
#254 ranked lender in California - 380 contributions

If that rate of 4.5% includes the buyout of the PMI then it's marginal. If you still have to pay the $5000 on top of the 4.5% rate then it's terrible. Either way I'd get another quote.

Aug 10th 2011
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George DeVine (gdevine)
#7 ranked lender in Rhode Island - 45 contributions

First of all, it is not NO PMI, it is a one-time PMI payment. To determine if it is better to pay a one-time insurance premium vs. monthly mortgage insurance, divide the monthly mortgage insurance cost into the proposed up-front premium to determine the number of months it will take to break even. Generally speaking, if you're going to keep the mortgage for longer than it takes to break-even, then that is the way to go. As for the rate and whether or not it's competitive, I'm with Gregorio from Trident (my old friend), get another quote.

Aug 11th 2011
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George DeVine (gdevine)
#7 ranked lender in Rhode Island - 45 contributions

After reading your question more closely, it appears you're quoting an APR of 4.58% vs. the actual interest rate. If this is the APR, then it appears to be a good deal. If it's the rate, then get another quote (and I meant my friend at Tripoint, not Trident).

Aug 11th 2011
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