Average Mortgage Insurance Costs

how much is mortgage insurance?

I’m just wondering how much mortgage insurance costs. I know you have to have it if you put less than 20% down. I’m thinking of buying a condo/townhouse, and I don’t know that I’d have 20% to put down, maybe 10%, depending on the property I would buy. I’m just wondering how much the average mortgage insurance costs. Is it a percentage of what you put down or a percentage of what your mortgage is or is it a set amount, no matter what? Also, I know that I would stop paying mortgage insurance after I’ve reached 20% principal, so does it automatically stop, or do you have to keep track, and then take it off yourself? Just wondering.

PMI is there to cover a lender in case of a foreclosure (and for other reasons). You have all of you facts correct. To get rid of it you need to prove 20% equity in the property based upon the original purchase price. Homes appreciate, you do improvements, you make extra payments – there are various way to get rid of it. By federal law your lender must cancel it when you reach 78% loan-to-value however you can cancel it yourself at 80% LTV if you have a solid payment history.

The amount you will pay is based upon your loan amount, credit rating, and LTV. If you have an approval without any of the various levels (meaning your credit is fine), you will pay the least for PMI. If you want to know what the monthly payment would be you can email me with the above info and I’ll be happy to give you that figure.

As far as 80/20 or piggy back loans go, they are not as attractive as they once were due to the fact that Congress, in last years tax bill, now allows you to deduct PMI from your federal income taxes along with all of the interest you pay on the mortgage.

Mortgage Insurance Tax Deduction Gone. Choose Your Own Loan Term Arrives.