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Old 06-04-2008, 05:46 PM
 
37 posts, read 160,970 times
Reputation: 22
Question can pmi differ b/t lenders? June 1 problems?

After a weird first mortgage experience, and lots of research for a second mortgage experience, I know that I know enough to be confused! I am getting differing answers regarding PMI. I know the PMI basics (not having 20% down, etc.) and how it differs between FHA and Conv, but

(1) can PMI differ between lenders? At first I thought the rates were set by a standard formula, but now I've been told it can depend on the lender. Can they vary between lenders? If one lender has a very high PMI does this mean they made a lot of risky loans in the past and are now having to charge higher premiums on their current products?

(2) I have a GFE from the end of May with a low PMI. Now the June 1 revisions are out. Can that PMI amount change drastically?

(3) If a have a GFE, and at closing the lender says, "Oh, gee, I'm sorry, but I really miscalculated your PMI and it's quite a bit higher," is that allowed? How much can I trust the amounts on the GFE to be the same or very close at closing, as long as the info I provided hasn't changed?

I don't quite understand how the 3rd parties that underwrite PMI affect the pricing between lenders. I appreciate any help you can give.
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Old 06-04-2008, 07:27 PM
 
Location: Charlotte, North Carolina
5,137 posts, read 11,149,816 times
Reputation: 967
1. Yes because every lender may use a different Private Mortgage Insurer.
There are at least 6 PMI companies that major lenders use. Lenders don't give the PMI. It is given from a private entity to the borrowers of a lender.

2. June 1st was the latest update from FNMA, and major PMI companies.
Since these companies are private they may update their guidelines with the flow of the economy or on their own terms. Also, a lender might've switch to another PMI company. A lender may use a couple of PMI companies due to different standard/policies for each PMI company.

3. If you're paying PMI, I would HIGHLY suggest that you look into a FHA loan. FHA MIP/PMI rates are fixed at 0.5% of the loan amount.

If your loan amount was 100k, then it would be 500annually.
100k x 0.5% = 500
500/12= 41.67 monthly

Quote:
Originally Posted by weartoomanyhats View Post
After a weird first mortgage experience, and lots of research for a second mortgage experience, I know that I know enough to be confused! I am getting differing answers regarding PMI. I know the PMI basics (not having 20% down, etc.) and how it differs between FHA and Conv, but

(1) can PMI differ between lenders? At first I thought the rates were set by a standard formula, but now I've been told it can depend on the lender. Can they vary between lenders? If one lender has a very high PMI does this mean they made a lot of risky loans in the past and are now having to charge higher premiums on their current products?

(2) I have a GFE from the end of May with a low PMI. Now the June 1 revisions are out. Can that PMI amount change drastically?

(3) If a have a GFE, and at closing the lender says, "Oh, gee, I'm sorry, but I really miscalculated your PMI and it's quite a bit higher," is that allowed? How much can I trust the amounts on the GFE to be the same or very close at closing, as long as the info I provided hasn't changed?

I don't quite understand how the 3rd parties that underwrite PMI affect the pricing between lenders. I appreciate any help you can give.
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Old 06-04-2008, 08:12 PM
 
37 posts, read 160,970 times
Reputation: 22
We will be getting a 15 year mortgage, and will reach the 20% down mark not too long after closing. At 15% down, I've been given a PMI price of under $50 for a conv loan, not an FHA loan. Since we'll reach 20% down easily before the end of the year, I'm concerned about FHA where I have a large MIP financed into the body of the loan. That means we'll be paying too much money (that is not refundable, am I remembering that right?) for 3-4 months of mortgage insurance.

HOw does that sound?
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Old 06-04-2008, 08:14 PM
 
Location: Charlotte, North Carolina
5,137 posts, read 11,149,816 times
Reputation: 967
you're doing good, but remember that lenders are only required to cut off your PMI at 78%. You may have to hassle them to do it also

Quote:
Originally Posted by weartoomanyhats View Post
We will be getting a 15 year mortgage, and will reach the 20% down mark not too long after closing. At 15% down, I've been given a PMI price of under $50 for a conv loan, not an FHA loan. Since we'll reach 20% down easily before the end of the year, I'm concerned about FHA where I have a large MIP financed into the body of the loan. That means we'll be paying too much money (that is not refundable, am I remembering that right?) for 3-4 months of mortgage insurance.

HOw does that sound?
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