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Is there a way to avoid PMI if you dont put 20% down?
I have no idea about mortgages lol. But i know i've heard of people buying, not putting 20% down but being able to avoid paying PMI. How would you go about doing that?
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Posted 5/3/09 3:24 PM  |
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MelBobby
LIF Infant
Member since 11/08 292 total posts
Name:
Mel
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Re: Is there a way to avoid PMI if you dont put 20% down?
I'd like to the know the same thing!!!
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| Posted 5/3/09 4:30 PM |
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Erica
LIF Adult
Member since 5/05 11767 total posts
Name:
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Re: Is there a way to avoid PMI if you dont put 20% down?
you get a piggy back loan. a loan for 80% and then a loan for 10 or 15% (80/10/10 or 80/15/5) they used to be very popular...not at all anymore, but a broker told us that you can still get them.
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| Posted 5/3/09 4:33 PM |
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Sneezy
Thankful for my miracle!
Member since 5/05 1939 total posts
Name:
Jen
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Re: Is there a way to avoid PMI if you dont put 20% down?
Posted by Erica
you get a piggy back loan. a loan for 80% and then a loan for 10 or 15% (80/10/10 or 80/15/5) they used to be very popular...not at all anymore, but a broker told us that you can still get them.
That is what we did; I do think it was easier to get a piggy back loan 4 years ago when we did it though. We put 9% (I think) down and borrowed the other 11%. Our small loan is at 5% and amortizes over 15 years. Our large loan is also at 5% and amortizes over 30 years. (We got very luck with the interest rates.)
This way, all of our payments go toward principal and interest, as opposed to paying the PMI (which you get nothing for). Hope this helps!
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| Posted 5/3/09 7:22 PM |
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charon54
My two boys!
Member since 5/05 7279 total posts
Name:
Rebecca
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Re: Is there a way to avoid PMI if you dont put 20% down?
We did an 80/15/5 when we bought our current home. We would love to do one again, but our broker told us they aren't doing them any more. If anyone knows where I can get one, let me know.
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| Posted 5/3/09 7:55 PM |
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Ang-Rich
Beyond Compare
Member since 5/05 17988 total posts
Name:
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Re: Is there a way to avoid PMI if you dont put 20% down?
The first time we took out an equity loan - piggy back that to the mortgage.
For the refinance we just paid the difference out of pocket.
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| Posted 5/3/09 8:39 PM |
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bikramaddict
mommy-to-be
Member since 8/06 4376 total posts
Name:
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Re: Is there a way to avoid PMI if you dont put 20% down?
we took out two loans two avoid the PMI.
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| Posted 5/3/09 9:13 PM |
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cindy104
This is my "Baby"
Member since 6/08 1522 total posts
Name:
Cindy
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Re: Is there a way to avoid PMI if you dont put 20% down?
Posted by charon54
We did an 80/15/5 when we bought our current home. We would love to do one again, but our broker told us they aren't doing them any more. If anyone knows where I can get one, let me know.
I'm pretty positive they don't do this anymore...unfortunately there's really no way around PMI anymore
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| Posted 5/3/09 11:22 PM |
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Melmel821
Love being a mom!
Member since 5/08 2776 total posts
Name:
Melanie
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Re: Is there a way to avoid PMI if you dont put 20% down?
I thought with a FHA loan you didn't have to put 20% down and avoided PMI.
Message edited 5/4/2009 8:11:02 AM.
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| Posted 5/4/09 8:10 AM |
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TreAnt427
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Member since 8/06 8652 total posts
Name:
Tracy
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Re: Is there a way to avoid PMI if you dont put 20% down?
My bank allowed us to pay a point and a half up front and they waived the PMI - I don't think all banks do this though.
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| Posted 5/4/09 8:21 AM |
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Nifheim
allo
Member since 1/09 5476 total posts
Name:
Jennifer
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Re: Is there a way to avoid PMI if you dont put 20% down?
PMI is called something else like MMI but you get charged either way!
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| Posted 5/4/09 9:05 AM |
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CaMacho
Sisters :)
Member since 7/06 15112 total posts
Name:
Jess
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Re: Is there a way to avoid PMI if you dont put 20% down?
We did the BofA No Fee Mortgage Plus loan (a year ago, not sure if they are doing it anymore) but we put down 10%, got a great low interest rate and are not paying PMI.
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| Posted 5/4/09 9:06 AM |
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S00N2BEAMOM
LIF Toddler
Member since 12/07 390 total posts
Name:
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Re: Is there a way to avoid PMI if you dont put 20% down?
We used Wells Fargo and were offered a chance to pay a one time up front fee (cash) at the time of closing. I think it was around $5k to avod PMI. We weighed our options and figured within 5 years we would reach 20% equity and decided we would reather have that money in the bank. In the long run if we would've paid it upfront we could've saved about $1200, so there are ways around it. I'm not sure if every bank does that though.
ETA - This is not a FHA loan
Message edited 5/4/2009 2:35:34 PM.
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| Posted 5/4/09 9:24 AM |
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SnickNNick
In our new house!!
Member since 8/08 2119 total posts
Name:
Nicole
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Re: Is there a way to avoid PMI if you dont put 20% down?
Posted by Melmel821
I thought with a FHA loan you didn't have to put 20% down and avoided PMI.
With FHA you have to pay “MMI” and a big chunk of it is up front—we rolled this into our loan which I think many people do, but you still do have to pay a form of Mortgage Insurance…
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| Posted 5/4/09 9:56 AM |
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Nifheim
allo
Member since 1/09 5476 total posts
Name:
Jennifer
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Re: Is there a way to avoid PMI if you dont put 20% down?
Posted by SnickNNick
With FHA you have to pay “MMI” and a big chunk of it is up front—we rolled this into our loan which I think many people do, but you still do have to pay a form of Mortgage Insurance…
Yep that is what we are doing.
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| Posted 5/4/09 10:08 AM |
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Nik211
my little monkey<3
Member since 5/08 3303 total posts
Name:
Nik
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Re: Is there a way to avoid PMI if you dont put 20% down?
we are putting 15% down.....we have the money in the bank to do the full 20% BUT there are some things we want to do to the house that we can use that money for AND we want to have a small nest egg in the bank as well...
i guess we really should look into options to avoid the PMI - i think for us it comes out to less than $100 a month but still, i rather not pay it...
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| Posted 5/4/09 10:11 AM |
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Melmel821
Love being a mom!
Member since 5/08 2776 total posts
Name:
Melanie
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Re: Is there a way to avoid PMI if you dont put 20% down?
Posted by SnickNNick
Posted by Melmel821
I thought with a FHA loan you didn't have to put 20% down and avoided PMI.
With FHA you have to pay “MMI” and a big chunk of it is up front—we rolled this into our loan which I think many people do, but you still do have to pay a form of Mortgage Insurance…
This is why I love this board. People keep pressuring me to buy a place as an investment because you can put only 3.5% down... Everything adds up MMI or PMI, taxes, property fees (for condos), insurance...
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| Posted 5/4/09 1:33 PM |
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Re: Is there a way to avoid PMI if you dont put 20% down?
There are a few options...
1 - Split your loan...Borrow a 1st mortgage of 80% and a 2nd mortgage (HELOC) of 5-20%, depending on lender guidelines.
2 - LENDER Paid Mortgage insurance. Not every lender does this, but there are some banks that will charge you a little more in interest rate and will then waive the monthly mortgage insurance premium.
3 - FHA loans. With an FHA loan, you will pay an upfront premium of 1.5% of your loan amount, that is rolled into the amount of your loan. You will then pay a monthly Mortgage Insruance Premium. However, the RATE of that mortgage insurance with FHA is almost always lower than the PMI payment on a conventional loan (FHA is 5% of your loan amount over the course of a year...PMI is typically 15-20%).
(I work for a mortgage broker  )
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| Posted 5/4/09 2:13 PM |
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Janice
Sweet Jessie Quinn
Member since 5/05 27567 total posts
Name:
Janice
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Re: Is there a way to avoid PMI if you dont put 20% down?
won't be effective in LI, but wanted to throw it out there for other areas...maybe more upstate.
I got a USDA rural loan last month.
no money down, no pmi, 5% rate
good luck!
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| Posted 5/5/09 10:32 AM |
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Megs4
LIF Adult
Member since 11/08 1619 total posts
Name:
Megan
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Re: Is there a way to avoid PMI if you dont put 20% down?
We found that in the current economy most banks wouldn't allow piggy back loans anymore, so we did an FHA loan and the MMI situation applies to us.
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| Posted 5/5/09 11:00 AM |
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lorich
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Member since 6/05 9987 total posts
Name:
Grammie says "Lora Gina"
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Re: Is there a way to avoid PMI if you dont put 20% down?
Posted by CaMacho
We did the BofA No Fee Mortgage Plus loan (a year ago, not sure if they are doing it anymore) but we put down 10%, got a great low interest rate and are not paying PMI.
This is similar to what we did a couple years ago. I doubt in the current market this is even being offered.
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| Posted 5/5/09 6:40 PM |
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