When to Get a Equity Loan without a PMI

You should get an equity loan without a PMI whenever you can. PMI, or Private Mortgage Insurance, is simply a way for your lender to cover its interests in the case of default. PMI is only required when you put less than 20 percent down on a home. PMI can be expensive, so if you can afford to put down 20 percent, you should consider investing your money. You can also avoid paying for your PMI once your equity loan is underway.

How to Eliminate PMI Costs When You Begin with a PMI

You can get an equity loan, without a PMI even if you already have a loan. Your home’s equity must reach the point where you have invested 20 percent of the value of the home. This is typically the case for borrowers that have paid their mortgages for many years.

Once you remove the PMI, your payment will go down and the PMI will never be added again to that mortgage. The savings you will experience will depend on your credit, LTV and market conditions.

 

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