Realtor · Milwaukee, WI · Member since 2020 · 5 posts · 1 vote
Hello!
I am purchasing my first duplex in West Allis, WI. I am wondering if any one living in the Milwaukee has recommendations on how to go about finding a good lender in the area.
Additionally, I am looking to purchase the house with only 5-10% of the downpayment, therefore, I would be required to purchase PMI. I know that sometimes there are loopholes or ways to avoid paying PMI so any insight would be appreciated! I heard that there are home loans available to doctors & nurses that would not require PMI, has anyone heard of this?
Any advice or suggestions would be greatly appreciated, as this is my first deal! Thank you!
In my experience the credit unions (Summit and Landmark) have great rates and low closing costs. I've heard good things about Waukesha State Bank and Tri City National Bank too.
I've heard of the 80-10-10 (piggyback) loan (10% down, 10% HELOC, and 80% mortgage) but have no experience using it and never asked a lender about it.
If you're a first time homebuyer, you might find a loan with a low down payment and no PMI.
What you're looing for is a Physician Home Loan. Remember, there's no such thing as a free lunch. These loans typically have higher rates to make up for the lack of PMI. Do comparison shopping.
The purpose of PMI is to protect the lender on a small downpayment loan in case they have to forclose on the property, they don't want to end up under water. So depending on how much you put down, the PMI insurance will cover the gap to 20%.
30 year fixed rated loans will require PMI and that is not a decision the bank is making, that comes from the giverment entities Fannie, Freddie etc who buy up these loans from the banks.
There are some local lenders who will offer a 5 year portfolio loan with no PMI. They self insure that risk, but they are also only willing to commit to 5 years without adjusting the interest rates. So at some point you want to refi, typically in year 4 or 5 when you have enough equity to not require PMI any more.
I came across something about this today. Bank of America has something called the "Affordable Loan Solution" mortgage.
It offers 3% down and no PMI. But interest rates are obviously much higher than FHA or conventional. Here is a link to a bit of information. https://www.bankofamerica.com/...
I've worked with Tri City National Bank and Waterstone Bank in the Milwaukee area. I would check them out. Or you could always bring in a mortgage broker. A mortgage broker may be able to find you the exact loan you are looking for.