If I get an FHA loan and I put down 20%, do I still need to pay PMI?
I know it drops off when 22% of the loan is paid, but can I eliminate it from the start with the 20% down?
Ok, so it’s not called pmi, but it is for the life of the loan? That’s basically my question. Sorry I phrased it incorrectly.
Tags: Down, Loan, Need, Still
2011/12/08 at 22:09:24
First off, when you get an FHA loan, there is no PMI. Their version is paid through the ENTIRE loan. If you want to get rid of it, you have to refinance into a traditional mortgage once you have 20% equity.
Second, when there is PMI, it does not “drop” off when 22% of the loan is paid. You have to get your house appraised and the loan must be below 80% LTV. If you buy a house for $300,000, the PMI will not drop off after you pay $66,000….if the house is now only worth $150,000.
2011/12/08 at 21:32:54
FHA & VA loans do not have PMI. There is something similar to PMI that all FHA & VA mortgage loans have from the beginning of the mortgage loan until the mortgage loan is paid off.
This is not like a conventional mortgage loan when you are below 80% and your can prove this you will be relieved of the responsibility of paying this type PMI.
I don’t know why you paid 20% down on your mortgage loan it does not change the fact that you will be required to pay this type PMI for the life of the mortgage loan. You are also required to have an escrow account for your taxes and insurance for the life of a FHA & VA mortgage loan.
I hope this has been of some benefit to you, good luck.
“FIGHT ON”
2011/12/08 at 21:09:54
20% will do the trick.
Experience.
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