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Yes but how much would the increase in interest rate cost you per month?
I don't know yet. I've only received estimates on the scenario where I would pay the PMI. I intend to go with whichever scenario results in the lower monthly mortgage payment.
If you're so concerned with right now then why buy a house at all? If you are thinking short term, then better to keep your downpayment cash liquid and rent.
I'm thinking about right now because right now matters. I want a mortgage payment that I'm happy with from the start, so the idea of PMI dropping off eventually isn't all that comforting to me.
I don't know yet. I've only received estimates on the scenario where I would pay the PMI. I intend to go with whichever scenario results in the lower monthly mortgage payment.
I bet the difference is smaller than you'd think. It is likely in the 20-30 dollars/month range, which really wouldn't make much of a difference in how much house you can afford, especially after you factor in the tax deduction. But keep me posted when you figure out the exact number.
I bet the difference is smaller than you'd think. It is likely in the 20-30 dollars/month range, which really wouldn't make much of a difference in how much house you can afford, especially after you factor in the tax deduction. But keep me posted when you figure out the exact number.
The online mortgage calculator showed the higher interest rate scenario to be better, so I was going by that. Of course I had to make up the rate since the lenders are so secretive about that too even though they've already pulled my credit.
The online mortgage calculator showed the higher interest rate scenario to be better, so I was going by that. Of course I had to make up the rate since the lenders are so secretive about that too even though they've already pulled my credit.
I bet the difference is smaller than you'd think. It is likely in the 20-30 dollars/month range, which really wouldn't make much of a difference in how much house you can afford, especially after you factor in the tax deduction. But keep me posted when you figure out the exact number.
You're right. The interest rate they quoted for LPMI is 4.5% vs. 3.75% for PMI, so the monthly mortgage amount ends up being only a few dollars less with LPMI...guess I won't be going that route after all.
You're right. The interest rate they quoted for LPMI is 4.5% vs. 3.75% for PMI, so the monthly mortgage amount ends up being only a few dollars less with LPMI...guess I won't be going that route after all.
Guessing you are doing a relatively small loan. The rate difference on most of the LPMI deals I have done is .375-.500% higher and the payment reduction can be pretty substantial.
Guessing you are doing a relatively small loan. The rate difference on most of the LPMI deals I have done is .375-.500% higher and the payment reduction can be pretty substantial.
I expect the loan amount will be between 230K-250K, but I haven't found a house yet!
With the LPMI, my monthly mortgage payment would be less than what it would be with PMI. I understand that PMI doesn't last forever, but I'm concerned with right now. Someone above mentioned that I could have found a cheaper house, but I'm having problems finding what I'm looking for and having a bit more flexibility to increase the sales price would help.
If you are only concerned with cash flows in the near terms, you shouldn't buy at all, you should rent. Even if PITI would be less than rent, if you amortize your down payment over a short period such as 3 years, you almost certainly will be out of pocket more by buying than by renting.
It is true that this ignores the long-term impacts, but if this concerns you, then you are not really "concerned mainly with the near term" after all.
Which is it?
You seem to be taking conflicting positions simultaneously.
If you are only concerned with cash flows in the near terms, you shouldn't buy at all, you should rent. Even if PITI would be less than rent, if you amortize your down payment over a short period such as 3 years, you almost certainly will be out of pocket more by buying than by renting.
It is true that this ignores the long-term impacts, but if this concerns you, then you are not really "concerned mainly with the near term" after all.
Which is it?
You seem to be taking conflicting positions simultaneously.
See post #22 where I previously responded to you on this issue.
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