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Pre-pay PMI

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joshuan Joined: 24 Mar 2011 Posts: 1 1.37 Dollars($)	Posted: Thu Mar 24, 2011 7:15 am    Post subject: Pre-pay PMI Like 0 Dislike 0 I am shopping around for a mortgage and one of the brokers offered the option to pre-pay the PMI since I am only putting down 10%. This allows you to basically avoid the monthly PMI cost by pre-paying it in the closing costs. In my situation, I would break even in 2.5 years by pre-paying instead of potentially paying PMI for 7 years based on the amortization schedule. Based on my earnings, I am not able to deduct PMI payments. I also don't think it is likely my house will appreciate enough to drop the PMI in less than 2.5 years. Is this a good option?
adonis Joined: 22 Oct 2005 Posts: 10562 Location: ALASKA 1089.18 Dollars($)	Posted: Thu Mar 24, 2011 7:33 pm    Post subject: Like 0 Dislike 0 Hi joshuan, If you can affords to pre-pay the PMI, then I think it will be a good option for you. It will help you in getting rid of the PMI within 2.5 years. So, I will suggest you to go for it. _________________ Procrastination is the enemy of your financial success
jveenstra Community Expert Joined: 10 Nov 2008 Posts: 1310 Location: River Edge, New Jersey 274.62 Dollars($)	Posted: Fri Mar 25, 2011 9:08 am    Post subject: PMI Like 0 Dislike 0 Yes, it is a good option. _________________ John Veenstra, Sr Mortgage Consultant Approved Funding Corp Licensed NJ NY CT PA 201-833-0123x278

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