Am I required to have PMI or MI?
You may be required to have Private Mortgage Insurance (PMI) or Mortgage Insurance Premium (MIP) depending on the type of and the amount you put down. For conventional loans, if you put down less than 20%, Semper Home Loans typically requires you to buy PMI. If you have PMI, you will make a payment every month until:
- Your mortgage balance reaches 78% of the home’s value. At this point, your mortgage servicer is required to terminate your PMI.
- You’ve reached the midpoint on your loan term.
- Your equity in the home has reached 20% of the purchase price or appraised value.
For FHA loans, you will be required to pay MIP if your down payment is less than 20%. If you put down less than 10% you will pay MIP for the life of the loan. If your down payment is greater than 10% you will pay MIP for 11 years.