To the surprise of many homebuyers, there is more than one way to obtain PMI. One of those PMI alternatives is called Lender Paid Mortgage Insurance, or LPMI, and Bluecastle Lending offers it.
What is Lender Paid Mortgage Insurance?
Lender Paid Mortgage Insurance is a form of PMI that is paid for by the lender via a one-time fee, rather than by the borrower monthly. Some form of PMI is required whenever a borrower puts less than 20% down on a conventional loan.
Quite often, LPMI borrowers are able to qualify for a higher purchase price than with regular PMI, since the monthly payments are usually lower even though the interest rate is a bit higher.
The disadvantage of LPMI is that you will have that interest rate for the life of the loan, vs a lower interest rate that will ultimately yield an even lower monthly payment than LPMI when you reach 78% Loan to Value (20% equity)
What is better, PMI or LPMI? It depends on what your credit score is, how much you are putting down, and how long you are planning on staying on the property. Give us a call and we will gladly go over it with you according to your financial situation.
For information on this program contact us at 954-866-0000 or email us at info@bluecastlelending.com. Bluecastle Lending is an Equal Opportunity Lender