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I want to buy a house with 10% down, no PMI if possible. Options?

Mortgage options for 10 down and with no mortgage insurance. I am not VA qualified. 726 fico and first time buyer with stable income. by Fredricklyonne767... from New York, New York. Mar 2nd 2015 Reply


Chris Corica (chris@myqcfunding.com)
#22 ranked lender in New York - 59 contributions

There are great LPMI (Lender Paid Mortgage Insurance) options available. With a small adjustment to the interest rate it eliminates the separate monthly MI payment. This is an excellent way to reduce your monthly payment. Feel free to contact me for a no cost, no obligation rate and fee estimate. Chris Coricachris@myqcfunding.com

Mar 2nd 2015
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William J Acres (William_Acres)
#2 ranked lender in Arizona - 7,927 contributions

The effort you take to avoid paying MI will eventually cost you more. The cost of MI has actually decreased over the years, especially for borrowers with high credit scores.. Let me explain.. the cost of MI for 90% LTV is less than $37 per month for every $100K financed. With conventional MI, once you have paid for 2 years, and once your equity reaches 20%, you can request your lender remove MI, and you wont have to refinance to do it.. In this market, it's more than likely you can have the MI removed in 2 to 3 years. So your total cost for MI will be $888 to 1,332 for every $100K financed. There are other options for removing MI,,, one option is to go "lender paid" MI.. this is where the lender raises your interest rate to offset the cost of MI.. The difference in the rate will be about 0.50%, but the problem with this option is that you pay the higher rate for the life of the loan.. since your likely to get to 20% equity in just a couple of years, i wouldn't recommend lender paid.. There's also an option to pay an "upfront" policy. For this policy, you pay about $1900 for every $100K financed, and like the lender paid policy.. you don't get any of those funds back when you reach 20% equity.. Plus, you have to have those added funds on top of your 10% down.. the third option would be to do an 80/10/10.. this is where you financed 80%, put 10% down and carry a 2nd mortgage of 10%. The problem with this type of loan product is that your interest rate on the 2nd will be high.. somewhere north of 7%, and could be as high as 10%.. and typically their only amortized over 15 to 20 years.. With this option, your payment will be $90 for every $10,000 financed. (10% of $100K= $10,000, based on 7% / 15 years) and although your paying $90, less than $32 is going to principal from your first payment.. the rest is interest.. in 3 years of paying on a 2nd, you would have paid a total of $3240, but your principal would have only gone down about $1250... When you compare all these options, you can see how it's like I said in the beginning.. by not paying MI, it can actually cost you more.. both monthly and overall cost.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com

Mar 2nd 2015
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