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BubbleWrapGuy t1_itusn43 wrote

Reply to comment by breafofdawild in Mortgage Lender Recommendations - FHA by GaimanitePkat

> No one expects you to put 20% down.

True. Including the down payment assistance grant, which was 2%, I put down a total of 3.5%. PMI comes to about $86/month for my home.

I believe that with FHA loans you get MIP which is like PMI except that it never falls off the loan. You have to refinance to get it removed. Please fact check that as it's been a minute since I've gone over all of this information.

Edit: Just looked this up -- from what I saw if you pay at least 10% down on an FHA loan you pay MIP for 11 years. Less than 10% down and you pay MIP for the entirety of the FHA loan.

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BlueXTC t1_ituvs3m wrote

Once you hit 20% equity you can request the PMI to be removed. I did it with our mortgage from VA Credit Union. It was removed for the next payment. You have to file a formal request and there is an appraisal done to make sure you have sufficient equity to remove the PMI

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BubbleWrapGuy t1_itv43x6 wrote

On a conventional loan, yes, you can request PMI to be removed after 20% equity and two years of on-time payments. FHA loans have MIP, which is basically the same thing as PMI but with different rules.

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GaimanitePkat OP t1_itutifw wrote

>I believe that with FHA loans you get MIP which is like PMI except that it never falls off the loan. You have to refinance to get it removed. Please fact check that as it's been a minute since I've gone over all of this information.

yeah this sounds about right. Like I said, the guy really flashed through everything so fast.

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dj1200techniques t1_itv66ls wrote

Yes but you can also do a rate and term streamline FHA refi once you have 20% equity and the PMI payment falls off.

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gracetw22 t1_itv8idx wrote

No, even a streamline FHA at 80% loan to value will have PMI. It’s a bummer but just how those loans work

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dj1200techniques t1_itv9a1m wrote

Whaaaaat ?? That must be something new. Then again I haven’t written a loan since 2008 🤷🏽‍♂️

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BubbleWrapGuy t1_itvbuuv wrote

I believe FHA loan rules changed in 2013 (based on the one source I checked this morning).

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gracetw22 t1_itvk1cz wrote

Yep, you can put 50% down on an FHA loan and the MI never drops off. I think it changed in the last 10 years but can't quite remember when.

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