Private Mortgage Insurance Explained: Payments, Terms and Options

Private Mortgage Insurance (PMI) is required any time you are financing a loan that is higher than 80% Loan to Value.  Or in other words, if your down payment is less than 20% of the home’s sale price.  In this video, Mark Robertson, a Mortgage Advisor with Samuel Scott Financial Group, explains Private Mortgage Insurance payments, terms and requirements.

Private Mortgage Insurance is required in order to protect the lender against any default on the loan. The charges are dictated through looking at two important variables; your credit score and the size of your down payment. Depending on those two factors, your PMI rates will usually fall somewhere between .25%- 1.25%.

One good thing to remember is that you typically only have to make these payments for two to five years.  Sometimes even less, depending again on how much you initially put down and a variety of other reasons. It is cancelled when the loan-to-value reaches 78% of the original sales price. And the date can be accelerated by making additional principal contributions to the loan.

It’s important to remember that while you can learn a lot online, there are many details that make your financial situation unique.  An experienced Mortgage Advisor can explain all of the factors that will influence your monthly payments and the overall cost of financing your home.  We’d be happy to help you learn more about PMI customizing a home loan to fit your needs.

For example, to avoid the addition of PMI payments to your loan, a Mortgage Advisor might recommend an alternative solution, like an “80-10-10” loan.  This loan program involves taking out two loans (one for 80% of the home value, and a second for another 10% of the home value) and making a 10% down payment.  Because the loan to value ratio is now less than 80%, PMI isn’t necessarily required.

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Mark Robertson was one of the four original Mortgage Advisors who helped launch Samuel Scott Financial Group in 2006.  Six years later, he remains one of their top producing originators and a client favorite.

Mark believes that it is his job to empower people and help them make educated decisions about purchasing or refinancing their home.  With more than a decade of experience in real estate and lending, he uses his expertise to position his clients for successful transactions.

Through out San Diego, Mark is known for his incredibly high level of customer service.  He goes above and beyond to make sure his clients receive star treatment and professional communication.  His ‘first-class’ mentality has earned him an outstanding reputation and thriving business with high end clientele looking for specialized loan programs.  Mark is the perfect source of information for buyers who need Jumbo loans, are self employed or have other unique financial situations.

Samuel Scott Financial Group is a boutique mortgage company recognized for superior customer satisfaction and the way they tailor the residential loan process to every individual client.  Todd “Samuel” Pianin and Brian “Scott” Reynolds founded the company on the principles of long lasting relationships, and a sincere honest approach to every single individual we serve.  Consistent and reliable, Samuel Scott Financial Group has been selected as The

Best Mortgage Company in San Diego for the 5^th straight year by readers of local publications.

President:  Todd Pianin

Vice President of Sales:  Russ Schreier

Mortgage Advisors:  Christian Alvarez,  Dean Brown, Mark Buchanan, Mitch Palmer, Brian Reynolds, Debra Roberts, Mark Robertson, Alex Scoma, Brian Shaw, Keith Sims, David Talbott.

 

Samuel Scott Financial Group is licensed by the CA Dept. of Real Estate license #01458652 and NMLS identifier 235584. ©2011 Samuel Scott Financial Group. All rights reserved.