Are there lenders that will do above 80% on a single residential loan that don’t require mortgage insurance?
Yes, you will just pay a higher interest rate that will end up costing about the same as the Insurance would.
But, according to several factors, the fact the interest might be tax deductible, might make it the better deal.
On the other hand if it is an owner occupied property that appreciates over time and/or you continue to pay down the mortgage, the Mortgage Insurance by law must go away at a certain point.
If you choose the higher interest rate vs mortgage insurance, the higher rate lasts for the life of the loan and refinancing would be about the only choice you would have to cahnge it.
There are a few ways to get around PMI and we use this method a lot.
We use two loans to avoid pmi, which would be your standard 80/20 loan, or if someone is putting 10% down then we would use and 80/10/10 loan and if they are putting 5% down then we would use an 80/15/5. All of those scenerios work really well.
And as Wes Stated there is also LPMI which is Lender Paid PMI which builds in the cost of the Mortgage insurance and gives you a higer interest rate.
We also have a wholesale company that calls it TAMI which is Tax Advantage Mortgage Insurance. And it too is the same thing but i think they require a 90% LTV
I hope this helps.
If your CLTV is above 80% one way or another your paying for it. Be it TAMI, Combo Rates, PMI, etc.
Just my $0.02
Pat,
I agree with you. However I do think that using the combo loan is much better due to the fact that you are able to write off the mortgage interest.
I agree. I’ve done a loan once (1 time) with PMI. It was either the 2nd or 3rd loan I ever did. After explaining what PMI was and almost losing the deal I’ve never done another loan with PMI…I’ve also never done another FHA loan.
I agree that PMI is a waste of money and have always had my clients do a combo loan to avoid it.
However, all of those clients who were in a LOC second may want to revisit the MI scenario. With Prime continuing to climb those who were in LOC’s tied to prime are getting nailed.
Here is the thought for the day:
Depending on the LTV, would it not be better to pay a small amount of PMI than it is to do a second.
<<[b]Here is the thought for the day:
Depending on the LTV, would it not be better to pay a small amount of PMI than it is to do a second. [/b]>>
When pigs fly!
Keith
Ha! I was wondering how long it would take for someone to respond to that! Ithought that we needed a good fire starter today!
You probably could have named two or three names of folks that you thought might respond and probably would have been right with one of them, too!
I read that and said, “Wow…usually Mark is relatively sane…maybe he’s just smoked some bad dog food or something…”
Keith
PMI 
Ha! I knew that you would be one of the first to fire back on that one. I thought that i would be a little devilish this morning and get some blood pumping!
As for smoking the dog food… 8)