Updated about 7 years ago on . Most recent reply
Down payment!!! conventional/FHA
Looking to avoid PMI, and maybe saving some money every month with a 5% down payment on a conventional owner occupy loan. Has anyone actually saved with this strategy? Can I attack principal and build equity faster with this strategy? It will take a good portion of my cash. Any help will be appreciated!!! THANK YOU
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#1 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
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#1 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
- Lender
- Fort Worth, TX
@Kevin Pereira I guess you could "avoid" PMI by prepaying it. Conventional loans do allow you to prepay your PMI entirely up front. You do save quite a bit doing this compared to doing it over time. It's usually about 33% of the entire amount.
Your other option is to have the lender pay for it. This strategy is where you pay a higher interest rate. So you don't come out of your own pocket go prepay the PMI and in exchange the lender provides you a credit for writing a higher interest rate on the loan.
Don't know if these ideas fit what you are needing to do but maybe they will help in some way. Good luck!