Dear First time home buyers, if you have less than 20% for your down payment, or if you have less than 20% equity when refinancing, you’ll probably be required to pay PMI as a fee that gets added to your monthly mortgage payment. PMI can add hundreds of dollars to your monthly payment amount.
Most first time home buyers can’t afford a 20% down payment, so paying PMI is common. That’s why PHH Loans provides options to help clients with conventional loans – to reduce or eliminate their PMI payments. If your goal is to get the lowest monthly mortgage payment possible, our PMI Advantage program could be right for you.
There are two ways PMI Advantage can work:
- Instead of paying PMI as part of your monthly mortgage payment, PHH can raise your interest rate slightly to cover the cost of PMI.
- You can also choose to pay your PMI as a one-time payment at closing, which can be a great choice if the seller is willing to help cover the costs.
Whichever way you choose as a first time home buyer, you’ll get a lower monthly mortgage payment and save money in the long run.