Posts

Lender Paid M.I. Revisited – Why We Don’t Recommend It

We have been asked numerous times lately about “LPMI,” and it reminded us to re-publish the below comments. We have many conventional borrowers with less than 20% equity (or down payment) and an aversion to Private Mortgage Insurance (PMI). These borrowers often ask about Lender Paid Mortgage Insurance or “LPMI.” With LPMI a lender simply […]Read More

95% LTV With No PMI? LPMI Not A Good Deal.

Many lenders are again touting their 5% or 10% down loans with no private mortgage insurance (PMI). Almost all lenders (including JVM) offer this through a product called Lender Paid Mortgage Insurance (LPMI). With LPMI, borrowers take a higher rate in exchange for no PMI. Lenders get more yield premium or commission with the higher […]Read More

Lender-Paid-Mortgage-Insurance – Overrated?

Many lenders tout Lender-Paid-Mortgage-Insurance (LPMI) as a way to avoid mortgage insurance. In fact, one of our lending sources (Quicken) has extremely good LPMI rates. With LPMI, borrowers can avoid mortgage insurance altogether by taking a slightly higher interest rate (3/8 to 1/2 percent higher for a 90% LTV for example). There is no free […]Read More

Lender Paid M.I. – Why We Don’t Recommend It

We talked a borrower out of pursuing “LPMI” yesterday, and it reminded us to re-publish the below comments. We have many conventional borrowers with less than 20% equity (or down payment) and an aversion to Private Mortgage Insurance (PMI). These borrowers often opt for Lender Paid Mortgage Insurance or “LPMI.” With LPMI a lender simply […]Read More

Lender Paid M.I. – Why We Don’t Recommend It

We have many conventional borrowers with less than 20% equity (or down payment) and an aversion to Private Mortgage Insurance (PMI). These borrowers often opt for Lender Paid Mortgage Insurance or LPMI. With LPMI a lender simply waives PMI requirements in exchange for a higher interest rate. For example, a $400,000, 90% LTV loan might […]Read More