We have previously talk and explain about mortgage insurance in basic. The good advice is not to borrow more than 80% of the current value of your property, so you don’t need to purchase any mortgage insurance.
In calculating the costs referred to above assumes that you take a fixed rate mortgage with a loan to value of 95%, and pay mortgage insurance in 10 years. Change the assumptions and you change the cost. For example:
- The 85% and 90% loans, the cost is 13.4% and 12.5%, respectively. Although insurance is less, the additional loans are also less.
- The smaller the mortgage within the same range of insurance, the cost is higher. For example, the cost of insurance on a 91% fixed rate loans, which have the same as a premium of 95% of the loan is 14.3%.
- Adjustable rate mortgages have higher insurance premiums and thus higher costs, fixed rate mortgages.
Mortgage Insurance costs can be reduced if we manage to get the insurance removed soon. For example, if the insurance on a 95% fixed rate mortgage is removed in 5 years, but your living room with a mortgage of 10, the cost drops to 10.8%. But if you move in 5 years and to pay the mortgage, there is no savings. The early termination of Mortgage Insurance
--- source: www.mtgprofessor.com ---
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