{"id":307,"date":"2023-04-18T20:42:27","date_gmt":"2023-04-18T20:42:27","guid":{"rendered":"https:\/\/blogunitedpurpose.azurewebsites.net\/?p=307"},"modified":"2024-07-30T15:44:49","modified_gmt":"2024-07-30T15:44:49","slug":"everything-you-need-to-know-about-pmi","status":"publish","type":"post","link":"https:\/\/blog.unitedpurposemortgage.com\/index.php\/everything-you-need-to-know-about-pmi\/","title":{"rendered":"Everything You Need to Know about PMI"},"content":{"rendered":"\n

Understanding Private Mortgage Insurance + Making the Best of It<\/p>\n\n\n\n

Private Mortgage Insurance<\/a> (PMI) is a type of insurance designed to protect a lender in case something goes wrong with a loan and payments are not being made. A PMI is typically required for those who paid less than 20 percent of the home\u2019s purchase price towards the down payment. While PMI may just seem like an added stress, there are advantages that are worth it for some. A PMI will allow those who aren\u2019t able to afford a big enough down payment right away to still become homeowners. <\/p>\n\n\n\n

Types of PMI<\/strong><\/h2>\n\n\n\n

When it comes to private mortgage insurance, you have a couple different options to choose from. <\/p>\n\n\n\n

Borrower-paid mortgage insurance <\/strong><\/h3>\n\n\n\n

With borrower-paid mortgage insurance,<\/a> the premiums are part of your monthly bill. This includes things like the principal balance, interest charges and other costs such as property taxes. The funds will be disbursed every month to the insurance company.<\/p>\n\n\n\n

Lender-paid mortgage insurance<\/strong><\/h3>\n\n\n\n

Lender-paid mortgage insurance<\/a> involves the mortgage lender covering the cost of the mortgage insurance. However, it\u2019s important to note that you\u2019ll still be paying for the coverage as well as a higher interest rate on the mortgage. <\/p>\n\n\n\n

Single-premium mortgage insurance<\/strong><\/h3>\n\n\n\n

Single-premium mortgage insurance combines the entire cost of your insurance into one payment. Paying upfront will allow you to pay less towards your monthly payments.<\/p>\n\n\n\n

Split-premium mortgage insurance <\/strong><\/h3>\n\n\n\n

Split-premium<\/a> is similar to single-premium and borrower paid PMI. You pay an upfront premium, but can pay a smaller amount than with the other options. You will also get lower monthly costs, while lowering your mortgage payment at the same time. <\/p>\n\n\n\n

FHA mortgage insurance <\/strong><\/h3>\n\n\n\n

This type of mortgage insurance comes with an FHA loan where you make a payment upfront and then pay the mortgage insurance premiums.\u00a0<\/p>\n\n\n\n

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A post shared by @ilendtx<\/a><\/p><\/div><\/blockquote>