If you are shopping for a home, then you are undoubtedly looking for the best mortgage deal to finance the most important purchase in your life. Perhaps you have read about 97% loan-to-value (LTV) conventional loans with NO PMI (private mortgage insurance), and thought “No PMI, this is a really good deal.” Some mortgage companies call it the “FHA loan buster”; a lower down payment loan than FHA with NO up-front PMI and NO monthly PMI! All of the advantages of a FHA loan, but no worries of FHA-related issues during the appraisal.
Beware when considering a conventional loan with these terms. The interest rate on this type of loan is generally much, much higher than your standard conventional loan. Most likely, you will pay much more in interest over the term of the loan as opposed to the PMI in a standard conventional loan. You can pay down the mortgage to 80% LTV to remove the PMI in your conventional loan, but you will always be stuck with a high interest rate in a no-PMI conventional loan.
Do you want the best deal and the most options for your next mortgage? Please contact me and I will put you in touch with the best mortgage professionals for the job. I work with an excellent network of professionals who work hard to get the job done at the best deal for my clients.