How Long Do You Pay PMI on an FHA Loan?
by Dr. Eugenia Orr
Buying a house is still a good investment.
PMI stands for Private Mortgage Insurance. PMI is required on mortgage loans when a home was purchased with less than a 20 percent down payment. This insurance protects the lender in the event the borrower defaults on the loan. The borrower pays a percentage monthly of the total financed loan amount. FHA loans required a 3.5 percent down payment, requiring PMI to be paid on the 96.5 percent loan-to-value amount. Currently the monthly PMI is 0.55 percent of the loan amount, but as of October 5, 2010, the rate will be 0.77 percent.
Other Fees Associated
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