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Is monthly PMI recalculated each month or a one-time calculation?

Hello,
I've been adverse to PMI for a long time, but after seeing the rates on PRIVATE mortgage insurance, it's actually sort of useful.  But I'm trying to compute our monthly payment and am interested to know if the monthly PMI amount is updated by a constant rate/multiplier each month until we hit 78% or if it's computed at closing and remains the same price each month until we hit 78%?

Any help would be greatly appreciated!
  • September 14 2012 - US
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Answers (2)

I think your question was actually about whether the MI premium adjusts as the loan balance declines.  Monthly premiums are set based on the initial loan amount and remain constant.  Single premiums are obviously only paid once. 
  • September 14 2012
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PMI rates are based on 2 primary factors:
- loan-to-value
- credit score

This holds true for Single Premium insurance also.

Thanks,

Mark
  • September 14 2012
  • 0Yes

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