What is Private Mortgage Insurance?

 lenders require private mortgage insurance as part of a conventional loan to protect them in case you end up in foreclosure. PMI is also required if you refinance your mortgage with less than 20 percent equity. PMI is a layer of protection for lenders, but an added expense for borrowers.


The Cost of Private Mortgage Insurance

 lenders require private mortgage insurance as part of a conventional loan to protect them in case you end up in foreclosure. PMI is also required if you refinance your mortgage with less than 20 percent equity. PMI is a layer of protection for lenders, but an added expense for borrowers.


Consider a Goverment-Backed Loan

The best option for avoiding PMI without putting 20% down is to take out a government-backed loan that doesn't require it. Both VA and USDA Rural Development loans are available with little to no down payments without requiring PMI or other ongoing insurance payments. 

Both do require upfront fees, but these onetime costs can be cheaper in the long run than paying PMI every month.

Know Your Options

Private mortgage insurance helps home buyers purchase homes with less than twenty percent down but, despite its benefits, some consumers aim to avoid their PMI at all costs. If that's you, contact us to talk to an expert at Home 1st Lending.

Let's Talk PMI

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