Did you know...
A Federal law, covering loans closed on or after 7/29/99, includes two basic consumer protections:
1. Your right to request Private MI cancellation when your mortgage balance has reached 80% of the original value of the house. Your lender is required to inform you about the right to request cancellation and how to cancel both at the loan closing and annually thereafter.
Furthermore, there is automatic cancellation of Private MI by your lender when the mortgage balance reaches 78% of the homes original value.
2. It is important to understand that the PrivateMI company does not make the decision to cancel insurance. In this case, you should contact the company that you send your mortgage payments to for more details on your loan.
Here are some alternative MI options: *Note: these options will vary from lender to lender.
SINGLE SOLUTION – 30 YEAR
This is the MI coverage that you can pay up front for the life of the loan. For example
@ 95%+ the coverage is 20% and the rate is 2.80%.
$200,000 loan amount x 2.80% = $5600
Borrower OR Seller can pay single premium of $5600 and never have a MI payment
REFUNDABLE STANDARD ANNUAL – 30 YEAR
This is a single premium rate for the 1st year and then reduced monthly MI rate after that.
95%+ LTV the coverage is 20% and 1st Year is .70 and renewal is .55.
$200,000 loan amount x .70% = $1400.
Borrower or Seller can pay upfront fee of $1400. After the first year the borrower pays a reduced monthly rate of .55 (compared to typical .59)
For any additional questions on Mortgage Insurance, please do not hesitate to contact me!
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