You should consult your own tax, legal, and accounting advisors before engaging in any transaction. This material has been prepared for informational purposes only. Signature Home Loans LLC does not provide tax, legal, or accounting advice. We’ll personally work with you and help you through the whole process. You can email your questions to or sure to ask us for a free quote on your next mortgage. Use this free calculator to figure your monthly USDA home loan payments inclusive of mortgage insurance premium (MIP), loan guarantee fees, and other common homeowner related expenses including property taxes and insurance. Let us know if you have any questions you’d like us to answer on this podcast. Thanks for listening and reading the Mortgage Brothers Show. Be sure to ask us for a free quote on your next mortgage. If you have any questions about this or if you have any questions you’d like us to answer on our podcast, you can email your questions to or give us a call at (602) 535-2171. As well, in mortgage insurance, there’s a law that says mortgage insurance has to be removed when the loan amount reaches 78% of the original value, which usually occurs around year 12. That being said, the actual loan factor, the percentage, will remain consistent. Since your monthly fee is based on a percentage, as your loan amount decreases your monthly amount will go down as well. In this example, the MI rate would go down to 0.2% at the 10 year mark however, the adjustment period isn’t always hit because a lot of people refinance before that 10th year. You’ll pay mortgage insurance monthly and then there is an adjustment period after the 10th year. They calculate the amount by taking 0.36% of the loan amount and dividing it by 12, to get your monthly amount. With this, you’d be looking at $60 a month at a mortgage insurance factor of 0.36%. When calculating this rate, we put in a 5% down loan, a $200,000 loan amount, one borrower, a 760 credit score, single family residence, and we selected it to be a primary residence. This is from the private mortgage insurance company, Radian. An example quote for Private Mortgage InsuranceĬheck out this PMI example quote. On top of that, a lot of our investors are looking to avoid PMI. We don’t get a lot of PMI on investment properties because the minimum down is 15%, and by the time you get to 15%, that PMI factor is pretty low. There are a handful of factors used in calculating PMI rates: the amount put down (5%, 10%, 15%, etc.), the loan amount, how many borrowers are on the loan, your credit score, the property type, and debt-to-income ratio. It’s for a loan that has less than 20% down.
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