MORTGAGE NEWS

[JohnnyD]

FHA... bleh! Glad we waited to save up 10% for a down payment. Lower monthly mortgage, lower interest rate, no FHA and we bought out of PMI.

FHA's are nothing more than catalyst to inflated housing prices. If a family cannot afford to put at least 5% down, then they are buying too much house.

[nightfighter]

I'm porked with a jumbo.

[WESTPORTMAFIA]

Originally Posted by nightfighter

I'm porked with a jumbo.

How jumbo? What county do you live in? There are high balance HARP loans with really low rates and no appraisal needed loan amount depends on your county. I also have a jumbo lender that goes to 95ltv with no pmi with great rates.
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[nightfighter]

PMI is what kills.... PM sent

[JohnnyD]

Originally Posted by nightfighter

PMI is what kills.... PM sent

My lender was able to structure the loan so that we bought out PMI. We pay a slightly higher interest rate (3.737%, instead of the 3.625%) but buying out(through taking out the higher interest rate) the PMI saved us almost $100/month.

[WESTPORTMAFIA]

Originally Posted by JohnnyD

My lender was able to structure the loan so that we bought out PMI. We pay a slightly higher interest rate (3.737%, instead of the 3.625%) but buying out(through taking out the higher interest rate) the PMI saved us almost $100/month.

It's called lender paid PMI and is usually the way to go. There is PMI on the loan it was just paid by your lender. There are 2 types of LPMI lender paid mortgage insurance. Lender paid single. This is when the lender pays the pmi in a lump sum and lender paid monthly where your lender pays the pmi company on a monthly basis. It's the smart way to go. But a lot of times the customer doesn't even know that the lender did LPMI which is not good practice. The rate change can be from .125 to .5 depending on credit score and ltv.
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[Rockport24]

Originally Posted by WESTPORTMAFIA

It's called lender paid PMI and is usually the way to go. There is PMI on the loan it was just paid by your lender. There are 2 types of LPMI lender paid mortgage insurance. Lender paid single. This is when the lender pays the pmi in a lump sum and lender paid monthly where your lender pays the pmi company on a monthly basis. It's the smart way to go. But a lot of times the customer doesn't even know that the lender did LPMI which is not good practice. The rate change can be from .125 to .5 depending on credit score and ltv.
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How much of a down payment do you need to qualify for something like this?

[WESTPORTMAFIA]

Originally Posted by JohnnyD

FHA's are nothing more than catalyst to inflated housing prices. If a family cannot afford to put at least 5% down, then they are buying too much house.

Actually back in the day it was a good idea. Many people could have made larger down payments but the rates were much lower than conventional and even with the pmi back then payments were lower than say putting 5 or10% down. And lots of people went FHA to keep cash on hand. Now it's a last resort loan for the most part.
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[trevier]

I was able to go from 6% down to 3 5/8%, kicked chase bank to the curb and now I'm with td bank, saving 386$ a month. I'll pay back my closing costs in 8 months, very happy.

[WESTPORTMAFIA]

Originally Posted by trevier

I was able to go from 6% down to 3 5/8%, kicked chase bank to the curb and now I'm with td bank, saving 386$ a month. I'll pay back my closing costs in 8 months, very happy.

Probably quicker if you consider the month you didn't have to pay and the escrow check that you got back from chase.
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[JohnnyD]

Originally Posted by WESTPORTMAFIA

It's called lender paid PMI and is usually the way to go. There is PMI on the loan it was just paid by your lender. There are 2 types of LPMI lender paid mortgage insurance. Lender paid single. This is when the lender pays the pmi in a lump sum and lender paid monthly where your lender pays the pmi company on a monthly basis. It's the smart way to go. But a lot of times the customer doesn't even know that the lender did LPMI which is not good practice. The rate change can be from .125 to .5 depending on credit score and ltv.
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Really appreciate the info. lender paid PMI was a completely foreign concept to us until my mortgage agent brought it up. We did the math and it definitely made a ton of sense for us.

Originally Posted by WESTPORTMAFIA

Actually back in the day it was a good idea. Many people could have made larger down payments but the rates were much lower than conventional and even with the pmi back then payments were lower than say putting 5 or10% down. And lots of people went FHA to keep cash on hand. Now it's a last resort loan for the most part.
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Way back in the day, for a brief period of time. As you said, now it's merely a "last resort loan" for people that shouldn't be buying houses anyway. If we look at any area where there are government backed loans where the 'rules of lending' are loosened, the market cost tends to skyrocket due to sellers knowing that the prices are artificially supported. This appears to be exactly what happened leading up to the housing bubble and history is repeating itself today with college loans.