Don’t Pay PMI on Your New Home Purchase!

Those regular followers of our mortgage news know we stress mortgage experience over everything. We keep getting home buyers contacting us telling us of the huge monthly or one time PMI fees they are being asked to pay. If you are putting less than 20% down on a new home purchase, most likely you have PMI added to your payment. Don’t go that route….it is not needed.

PMI is private mortgage insurance. FHA Home loans have FHA insurance on them. Either way, it adds quite a bit to your monthly payment and can be avoided. Our advice is to get a 1st for 80% of the purchase price and a Line of Credit for up to 15% of the balance. The HELOC line of credit does not require PMI and you buy the home of your dreams and have a payment you can afford. This can save you thousands per year and over years even more.

What is a HELOC

A Heloc is just a line of credit and a second trust deed is recorded on your home for it. One nice thing about the Heloc is it is usually approved 1 time for a set amount and as you pay it down the difference is always available to you. Nice to have for the future.

If your situation is calling for PMI go to a different lender that will do the Line of Credit for you.