What do you know about PMI- Private Mortgage Insurance? You spent the weekend at Open Houses, you found the home of your dreams, so What next? You speak to your lender, you roughly know what you should be able to handle in monthly payments and this home should fit the bill.
This is the typical scenario, however more and more folks are saying that in a PMI situation they are facing sticker shock over the expense that is PMI monthly payment. In most cases PMI cannot be avoided so it is good to know the numbers up front to avoid the let down- or sticker shock- when the full cost of the mortgage is laid out on the table.
So what is PMI? If a loan exceeds 80% of the homes value the PMI is designed to protect the lender in the event the borrower defaults.
What is the effect of PMI on monthly payments? On average homeowners report that the PMI portion of the monthly payment is about $100 but often with these loans that $100 can be the difference between smooth sailing through the home purchase or going back to the drawing board and perhaps looking within a different budget range in order to be sure the monthly PMI payment does not affect lifestyle wishes.
Best advice- sit down with your lender prior to finding the perfect home. Know your numbers. Know your numbers with PMI included.
Selling/Buying/Investing- You owe it to yourself to call Dawn McNary, REALTOR® , with Heritage Properties spc Today! Let me help you ‘Make YOUR home ownership dreams a reality!’