Q&A


Eyal Tropen - Sr. Loan Officer

NMLS # 874253

Q: Should we buy a home now with a lower down payment and take out mortgage insurance? Or is it better to wait until we save enough down payment to avoid PMI before we buy a home ...

What is PMI?

Mortgage insurance (PMI) is required by lenders when taking a mortgage with a down payment lower than 20% of the value of the house (the lower of the purchase price and the appraised value). The insurance protects the lender in the event of a default from losses due to the difference between the selling price of the seized asset (after foreclosure and sale costs and expenses) and the unpaid debt.

So, is it better to wait until you save enough down payment to not pay mortgage insurance? Let's review the numbers...



Copyright © 2018. Eyal Tropen NMLS # 874253
Residential Mortgage Loan Originator Licensed in CA, OR, TX, WA

American Pacific Mortgage | NMLS #1850
625 4th Avenue, Kirkland, WA 98033 | NMLS # 1055557
Phone: 425-922-1055 | Fax: 855-549-8730 
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Master Builders Association