buying a house for 158k- house appraised for 224k- Should we have to pay pmi? isn't our loan 70% ltv?

Asked by Nadia, Grand Blanc, MI Tue Apr 1, 2008

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Sonya Loose, Agent, Beaverton, MI
Tue Apr 1, 2008
Nadia - the loan pmi is based on the sales price of the house and how much you are using as a down payment. Before moving forward you could check with other local, trusted lenders and see if there are other options for you. With the amount of foreclosures in Michigan and nationwide banks are seeking protection so requirements could have changed regarding PMI, they seem to be changing daily on other loan requirements. Either way you have found a good investment and I congratulate you! Spread the word, there are many good buys out there now.
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smith3gary, Agent, White Lake, MI
Tue Apr 1, 2008
Nadia, You're full of good questions. I would have to agree with Nicole. With the tightening of credit, everyone involved with the lending side have updated their requirements.

Alternately, you could seek pre-approval with another lender. I know you are under the gun to get this closed. I wish you good luck
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Nicole Sleeva, , Novi, MI
Tue Apr 1, 2008
Hi Nadia -

When making a purchase, everything revolves around the sales price. So in order to avoid PMI, you would have to have 20% down of the $158,000. However, check with your accountant because some PMI programs are now tax deductible. Also, check with your lender. You can refinance after a set amount of time (depending on your loan program) and use the appraised value, not the purchase price, and get out of the PMI. Good luck. It sounds like you found a great investment with instant equity!

Nicole Sleeva
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NonRealtor, , 23456
Fri Apr 11, 2008
did you have to pay PMI?
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Michelle Gor…, Agent, East Grand Rapids, MI
Tue Apr 1, 2008
I am not a lender, but I do not think your LTV matters for PMI insurance. I think it just matters if you have 20 percent into the loan or 20 percent down on the home.
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