Mortgage Insurance goes up April 18th

Real Estate Agent with Coldwell Banker Select

Here's what Mortgage Insurance is costing you now, and here's what the increase will cost.


Let's look at an example of a $200,000, here in Tulsa, Oklahoma you can get a nice home for this amount.

*Note that PMI costs more with conventional financing which means that you are paying a below market rate for the insurance with FHA financing which explains why FHA is currently losing billions of dollars each year.  You can avoid PMI by putting 20% down.  Check with your experienced loan professional.

Currently, PMI with 30 yr financing is 1% up front and .9% per month. (LTV greater than 95%)

So with our example, you would pay $2,000 upfront at closing and then $1,800 each year or $150/month.

On April 18th, the monthly PMI will increase by .25% so your yearly PMI will go up to $2,300 (1.15%) or $192/month.  You can use a rule of thumb of roughly $20 more per month per $100,000.

Now, if you are paying PMI now and want it removed, you have to show that you have 20% equity in your house.  The problem is that HUD often wants to use the original appraisal so it is difficult to remove PMI with a new appraisal that shows 20% appreciation on your home.  If you pay down the principal, you will have a stronger case.  Also, when you apply for removal of PMI, if you have had late payments in the last year, you can get turned down. Some loans will have a minimum period that you will have to pay PMI.

This eHow link has good information on removing PMI.

*Information believed to be accurate but not guaranteed. Consult with your local loan professional for more details.


Bank of Oklahoma -Phillip Morrow 918-488-7147

F & M Bank -Brett Casper 918-810-6950


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