How to Avoid Monthly Mortgage Insurance through your local lender.

Most consumers looking to purchase a property are under the impression that if they put less than 20% down for the purchase of their new home, they will be required to pay monthly mortgage insurance. This is a common misconception that is more than likely told to them by an uneducated loan officer. The truth is you can avoid paying monthly mortgage insurance purchasing a new home putting less than 20% down by utilizing a program known as "Borrower-paid single premium mortgage insurance".

Borrower-paid single premium mortgage insurance is a lump sum the borrower can pay at closing to avoid paying monthly mortgage insurance.

This program will typically provide benefits such as

1. Lower monthly mortgage payment
2. The buyer is able to afford a higher-priced home due to their debt-to-income ratio being lower
3. The consumer will never have to worry about refinancing to remove the monthly mortgage insurance
4. The builder or seller is allowed to pay the single premium if negotiated

Make sure to ask your lender about this money-saving program.

Written by Tim Borsa, Branch Manager

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