Remember, your monthly house payment includes more than just repaying the amount you borrowed to purchase the home. The "principal" is the amount you borrowed and have to pay back (the loan itself), and the interest is the amount the lender charges for lending you the money. For most bo...
Private mortgage Insurance (PMI).You may need to pay this if your down payment is less than 20% of your home’s purchase price. This protects the lender (us) if a borrower (you) defaults on a home loan. PMI usually increases the monthly payment amount until you’ve paid off the equiv...
A higher down payment may be harder to scrounge together upfront, but this will lower your monthly mortgage payments over the life of your loan. Don’t pay PMI. If your down payment is less than 20% of the home’s price, most lenders will require that you pay private mortgage insurance...
Reducing the principal of your home loan will reduce your monthly mortgage payments. There are two ways to reduce your principal on a new mortgage: Purchase a less expensive house Put a larger down payment on your home loan That said, you can always pay more than your monthly principal amoun...
Now that we’ve defined what mortgage insurance is, and how it can add big cots to your monthly mortgage payment, let’s talk about how to get rid of it. The good news is that homeowners can get rid of both their PMI for private loans and their MIP for FHA backed loans. The proces...