For many first-time homebuyers, mortgage insurance is a hot topic of conversation – What is it? Is it required? Is it worth it? We’ll answer all of that and more as we dive into some of the most commonly asked questions regarding mortgage insurance!
What is Mortgage Insurance?
Mortgage insurance is a protective policy that benefits lenders in case a borrower defaults on their mortgage. With mortgage insurance, new homebuyers can provide a smaller down-payment, allowing many to purchase a home sooner rather than later.
When is Mortgage Insurance Required?
Typically, homebuyers making a down-payment of less than 20% of the home’s purchase price will be required by the lender to pay for mortgage insurance.
Are There Different Types of Mortgage Insurance?
Yes! Here are the different types of monthly mortgage insurance:
- Private Mortgage Insurance (PMI), on conventional loans.
- FHA Mortgage Insurance Premium (MIP), on FHA loans.
- USDA Mortgage Insurance, on USDA loans for rural homebuyers.
Note that some loan products also have up-front fees, so if you’re wondering exactly what fees your loan program entails, be sure to ask your Pulte Mortgage Representative.
How Much Does Mortgage Insurance Cost?
The cost of mortgage insurance will vary based on factors like loan type, down-payment and the loan terms.
Can I Cancel Mortgage Insurance?
Under certain conditions, you may be able to cancel your mortgage insurance. Check with your mortgage servicer for complete details.
If you have any additional questions about mortgage insurance, feel free to reach out to your Pulte Mortgage Representative!
