How can I avoid private mortgage insurance?

If you have a loan amount that exceeds 80 percent of the value of the property, you can avoid private mortgage insurance (PMI) by breaking the mortgage in two. Let's say you have 10 percent down and you can get a first mortgage for 80 percent and a second mortgage for 10 percent of the price. Many lenders will not charge PMI with this financing arrangement. Another way around PMI with a high loan-to-value mortgage is to use a portfolio lender. Portfolio lenders generate loans to hold in their own portfolio, not to sell to other investors. Many portfolio lenders self-insure for PMI. To cover the cost of self-insuring, the lender charges the borrower a higher interest rate. Because mortgage interest is tax-deductible, that can work to your favor. Consult your tax advisor.

I pull out all the stops to sell your home.
Lonnie Snyder
Keller Williams
Realty Southeast Sound
Phone: 206-406-2710
E-Mail :
Lonnie Snyder is a full time real estate agent and REALTOR® with Keller Williams Realty specializing in Residential Real Estate for buyers and sellers in Washington’s Kent, Renton, Newcastle and South Bellevue.

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