Changes to the PMI Could Save Buyers Thousands

    Changes to the PMI Could Save Buyers Thousands
    FHA loans have been a frequent topic of discussion recently in the real estate industry. FHA loans enable buyers, who otherwise may not have been able to qualify, to purchase a home. 
     
    One advantage of an FHA loan is the lower down payment required. You can provide as little as 3% down using an FHA loan. This is a huge difference from the traditional 20% down with other mortgage loans. With an FHA loan, borrowers agree to a conventional 30-year fixed mortgage as well as to paying PMI, or property mortgage insurance, required with less than 20% down payment. Borrowers pay their PMI monthly until they have accumulated enough equity in the home that the lender no longer considers them high risk. 
     
    If you are currently in an FHA loan or in the market to purchase FHA you need to know this. On January 26th the PMI was lowered from 1.35% to .85% which is a saving of approximately $250 per month on a $600K loan balance or $3000 a year savings. If you are buying, this just gave you more purchasing power of approximately $40,000.

    If you would like more information please feel free to give us a call at 760-632-8900 and one of our professional Realtors would be happy to assist you.

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