Issuu on Google+

Real Estate

AtoZ by Cory Christians

One of the most misunderstood parts of your monthly house payment is that of mortgage insurance. When you purchase a home and do not have a minimum 20% of the purchase price as a down payment, you will pay mortgage insurance. The only other exception to mortgage insurance is to do a VA (veterans) home loan. Mortgage insurance is an insurance you pay as the borrower that actually protects a portion of the loan to the lender in case of a borrowers default. The mortgage insurance premium is paid as part of your monthly payment until your loan balance is below that 80% loan to original value. By making regular monthly payments it may take several years before your loan balance reaches that 80% threshold. The higher the percentage of the purchase price you are borrowing the higher the cost of the mortgage insurance. One alternative to paying a monthly mortgage insurance premium is to pay it in a lump sum at the time you originate that loan. The ability to pay the premium depends on your credit rating and all borrowers may not be eligible to pay it in a lump sum. The advantage of paying it in a lump sum is it is more economical. By paying it in a lump sum you now don’t have to pay it on a monthly basis making that monthly payment lower When working with buyers, my responsibility is to represent your best interests. Helping you work through the maze of financing options is a part of getting you the best home at the best terms. Please call me at 308-233-4553 so I can go to work for you!


325821