Profile picture for Josh_n_Kelly

Is it required as a home owner to continue to hold Mortgage Insurance?

We bought our home in February of 2008.  As part of our loan stipulation we were required to purchase mortagage insurance.  How long does it require for us to continue to purchase this insurance if we have been on time for our mortgage payments?

  • December 27 2008 - Columbia
  • 0Yes

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Answers (4)

If you have FHA, you are required to carry it for a minimum of 5 years, regardless of equity.
  • February 07 2009
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Profile picture for Chikung
That's not exactly true. Circumstances and states may vary.
I have 10% but the PMI was prepaid by seller and rolled into the closing.
Talk to a good mortgage broker on how to do this type of deal.
It cost very little-- about 3K.
You can either get the seller to agree to pick it up or increase the purchase price by the MI and get it credited back in closing on the costs.
Well worth it.
  • December 27 2008
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A mortgage closed on or after 07/29/99 that is secured by a one-family principal residence or second home. The servicer must automatically terminate the mortgage insurance on the applicable termination date—provided the borrower's payments are current on the termination date. The applicable termination date is the date that the principal balance of the mortgage is first scheduled to reach a level that is 78 percent of the original value of the property. (For a refinance mortgage, the servicer may use as the "original value" whatever appraised value it relied on for the refinance transaction.) If the scheduled loan-to-value ratio for the mortgage does not reach 78 percent before the mid-point of the mortgage amortization period, the first day of the month following the date the mid-point is reached must be used as the termination date.

  • December 27 2008
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Profile picture for Ken Kopper

Unless you have a FHA loan, you are required to carry PMI until you have 20% equity or more in the property

  • December 27 2008
  • 0Yes

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