If you put down less than 20% when you purchased a home, there’s a very good chance you’re paying for private mortgage insurance (PMI). This is an additional cost added to your monthly mortgage payment, so it makes sense if you’re looking for ways to cancel PMI. Since a 20% down payment is a traditional measuring stick of financial stability when it comes to buying a home, PMI safeguards mortgage lenders if you are unable to make mortgage payments.
As much as PMI is a huge help to those who can’t make a big down payment, let’s be honest: having an additional pesky monthly payment can get old.
That’s exactly why we’ve created this educational guide: Kick PMI off Your Mortgage Payment.
This free download will give you scenarios where you might be able to get rid of private mortgage insurance – and more importantly, start keeping more money in your pocket.
Below is one scenario to consider:
Refinance your mortgage
Depending on your current loan, a mortgage refinance can help you by lowering your monthly payment AND cancelling PMI. A mortgage double whammy! Here you’d get an appraisal to determine your home’s current value. And if the balance of your new mortgage is 80% or less than the home’s value, PMI would not be required.*
In this scenario, it’s important to make sure the PMI payments you’re removing are greater than the cost of the refinance.
*If you have an FHA loan, you can no longer cancel your private mortgage insurance premium, even after the loan-to-value ratio reaches 78% or less. You’ll have to pay the premium for the life of your loan.
This guide will also provide you with some things you may need to cancel PMI early, such as:
- A written request
- To be current on your monthly mortgage payments
- Proof you don’t have other liens
If refinancing your mortgage doesn’t make sense for you right now, don’t worry. In this guide, we provide four more ways you may be able to get rid of PMI—plus some next steps to make it happen. Give it a click.