Bye-Bye PMI

PMI is private mortgage insurance, generally required when your down payment on a conventional mortgage is less than 20%. You can ask your loan servicer to remove PMI once your loan balance is 80% of the original value of your home, but if you don’t request cancellation, servicers will automatically cancel it when your principal balance reaches 78%.  

MIP is the monthly mortgage insurance premium required for FHA loans and lasts as long as you have the loan. You’ll need to refinance to remove it. FHA loans also require a one-time upfront mortgage insurance premium. While neither VA nor USDA loans include PMI or MIP, they do require additional fees you should review with your loan officer.

The cost of mortgage insurance varies based on your loan amount, loan-to-value ratio, and credit score. According to Freddie Mac, most borrowers pay between $30 and $70 per month for PMI for every $100,000 borrowed. Mortgage lenders typically choose the lowest cost mortgage insurance provider for their borrowers.

As with any mortgage, we’ll need to evaluate your income, assets, employment, credit, identity, and other information. You can get started by contacting your CCM loan originator. 

Bye-Bye PMI is a conventional conforming mortgage program offering a 30-year fixed-rate home loan. Conventional means it’s not insured by the government, like an FHA, VA, or USDA loan. Conforming means it follows the loan limits set annually by the Federal Housing Finance Agency, which means it’s not a jumbo loan. You may also hear conforming mortgages referred to as Fannie Mae or Freddie Mac loans. Fannie and Freddie are the large entities that purchase conforming loans after closing. 

Conventional loans come in many forms. Bye-Bye PMI is a 30-year fixed-rate mortgage that allows a borrower to make a down payment of only 15% without paying monthly PMI. While there are other conventional loans with lower down payments, they require a PMI payment every month, adding to the monthly and overall cost of the mortgage.