How To Avoid PMI With Less Than A 20% Down Payment

July 3, 2008 - PRLog -- Have you ever heard of "Lender Paid Mortgage Insurance?"

Lender Paid Mortgage Insurance (LPMI) is where the lender doesn't require PMI in exchange for a higher interest rate. Now, who would want to pay for a higher interest rate? Well, if you are concerned about not exceeding a particular monthly payment, you may want to consider this option.

I've laid out two options, so you can compare the difference.

1. Loan Example with PMI

- $200,000 purchase price

- 5% down payment ($10,000)

- 30 year fixed rate of 5.875%

- Payment = $1247.42 ($1123.92 of principal & interest + $123.50 of PMI)

2. Loan Example without PMI

- $200,000 purchase price

- 5% down payment ($10,000)

- 30 year fixed rate of 6.375%

- Payment = $1185.35

Example 2 is $62.07 less every month. That is a savings of $744.84 every year!

So, if you are purchasing a home or refinancing your existing mortgage and you don't have that magical 20%, just tell me..."I want to know how much I can save with LPMI."

See more about this and free mortgage advice at genuinemortgagelending.com This is my personal website where you should fine loads of information about myself and how I take care of my clients. I focus my professional attention on helping homeowners that are not aware of certain loan programs and hope it will save them additional money over the life of the loan.