If you’re buying a home for sale in Lakewood or Long Beach, you’ll probably need a mortgage loan - most people do. Some people who are borrowing money to buy a house need to pay for private mortgage insuance, or PMI - but here’s how you cna avoid it.
Can You Avoid Buying Private Mortgage Insurance?
The easiest way to avoid buying private mortgage insurance is to put at least 20 percent down when you’ take out a mortgage loan. (Easy?! Well, maybe simple is more appropriate.)
However, even if you don’t have 20 percent of a home’s purchase price to put out there as a down payment, you may still be able to avoid paying for PMI. Here are a few ideas:
Have the house reappraised if you think it’s worth more
Use a piggyback loan (which will probably come with a higher interest rate, so be aware) to come up with all or part of a down payment
Pay a higher interest rate in what’s called lender-paid PMI (but remember that you can’t cancel it like you can PMI, and you’ll have to refinance if you want to get a lower rate).
Some lenders don’t require PMI for certain programs, even if you’re putting down less than 20 percent - so make sure you ask your lender if those types of programs are available to you.
Are You Buying a Home in Lakewood or Long Beach?
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