3- 5% Down and No Monthly Mortgage Insurance with a Conventional Loan

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good afternoon Steve Conn right here

your mortgage guy and I'm putting a

video together because I've gotten a lot

of questions lately on mortgage payments

and mortgage insurance a lot of people

who want to buy a house don't want to

pay mortgage insurance it's it's kind of

a necessary evil with a lot of loans if

you're gonna put down less than 20% so I

wanted to talk to you just for real

quick and let you know what options

exist for getting into a home without

putting down 20% and without having

monthly mortgage insurance now if you're

a veteran veteran's loans VA loans do

not have mortgage insurance so you're

okay a veteran's loan is one of the best

loans on the planet so if you're a

veteran you can contact me we'll get you

qualified for a VA loan and let you know

how how great your payment's will be if

you're not a veteran then the other

options that you have for a mortgage are

typically three main categories you have

FHA FHA is a loan that's that is insured

by the Federal Housing Administration

and the Federal Housing Administration

requires that you have mortgage

insurance it is a mortgage insurance

that you pay in two different ways you

pay it monthly for the life of the loan

and then you pay it up front there are

two things you pay the upfront fee is

financed into your loan amount and makes

your loan amount that much bigger the

cost of that FHA mortgage insurance

premium is 1.75 percent of your loan

amount that's a big chunk that's a lot

of money if if you're if you're looking

at a $300,000 loan that cost is five

thousand two hundred fifty dollars is

rolled into your loan so it makes your

loan that much bigger your payment goes

up in addition to having that monthly

mortgage insurance with FHA that's stuck

there forever so FHA is great if you

cannot get into a house and you qualify

for FHA it's still worth it to get into

a house because even though you're

paying that upfront expense the house is

going to appreciate and you're a

homeowner you have some tax deductions

so buying is still a good idea if you

can if you have a good credit and you

have maybe a little bit more money to

put down say five percent that then we

can put you into a conventional loan and

conventional loans are still guided by

mortgage insurance rules so you still

have to have mortgage insurance the cost

monthly on FHA unconventional mortgage

insurance is going to vary with each

client because that mortgage insurance

is private it's not government the

government mortgage insurance with FHA

is a one-size-fits-all if you have the

best credit in the world you're gonna

have the same mortgage insurance cost as

the person who has the worst credit that

is possibly allowed to be qualified for

a home loan your costs are going to be

the same so it's divided among the

masses and the people have great credit

pay too much the people who have really

bad credit and still qualify for FHA are

getting a really good deal so that's how

that works conventional private mortgage

insurance isn't the same if you have

really good credit really good income

good assets your mortgage insurance

premium is going to be lower so as your

credit gets worse the mortgage insurance

cost also will go up but what we can do

with that mortgage insurance rather than

paying it monthly you can opt for a

one-time policy so that premium is paid

at the time the loan closes versus

paying it for years and years on the

loan this this option can save you

literally hundreds of dollars per month

up to three to five hundred dollars per

month by paying it upfront what that

means for you as a buyer is you can

qualify for more house and and still

have the same payment so if you are

considering getting into a house with

less than 20% down and you have as

little as 3% this also works with a

conventional 3% down product or as much

as 15% we can help you get into a loan

with out

paying for mortgage insurance and this

is available without paying for mortgage

insurance on a monthly basis by doing

that one-time upfront policy this is

available throughout the country so no

matter where you are in the country if

you have questions about this feel free

to call me I would love to help you out

and there are options out there that

that can help you to have a lower

payment and I would love to help you out

with that and help you get the best

payment for you possible thank you so

much for watching and have a great day