Mortgage Insurance Companies rates vary pretty substantially based on the business that they are trying to carve out. If your buyer is having a hard time qualifying for a particular home, work with your lender to make sure they are getting the most competitive rate possible on their PMI. It might make the difference between a deal and no deal.
Here is an example we ran into this week:
Buyer has great credit, but a bit high debt-to-income ratio and only enough cash for the 10% down and required reserves.
Solution: We shopped two different PMI companies and found upfront PMI premiums ranging from 2.15% (of the loan amount) down to 1.44%. Using the upfront PMI premium vs. a monthly premium got their DTI in line. We were able to use the money from the seller contributions to cover the PMI and the deal is set to close on the 15th.
There are still creative ways to work through the changes in the mortgage insurance industry. Let us know if we can help.
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