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Approved with FHA Home loan but they require payment protection?
Posted on May 6th, 2010 4 comments
Amos&Asher=MyBoys asked:
why is this?
we have to have a 6% assist and 3.5 percent down, which is fine but why do we need this on top of the mortgage, taxes, and insurance?!
we are buying our first home from my mother in law for 90k and the home is worth 160k so we are deff making out good but whats up is this a scam?
app by bank of america by the way.
JudyRenting & Real Estate Bank Of America, Fha Home Loan, Fha Loan, Insurance, Loan Payment, Mortgage, Mother In Law4 responses to “Approved with FHA Home loan but they require payment protection?”
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First off, B of A sucks.
Secondly, this is called PMI – Private Mortgage Insurance. It is required for all FHA loans.
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Low down + FHA loan = Mortgage insurance required. Doesn’t matter what you think it’s worth.
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Alterfemego May 12th, 2010 at 18:25
Oh you’re talking Mortgage Insurance (PMI). It’s because you did not put 20% down.
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Noneya May 13th, 2010 at 14:03
First things first. If you are buying from your mother at $90,000 and the house is worth $160,000 you should be doing this as a gift of equity purchase. This way you will not need the 3.5% down payment.
As far as the mortgage insurance, this is an FHA requirement no matter how much equity you have. The only time you do not have monthly mortgage insurance on an FHA loan is if you do a 15 year fixed at a loan to value of 89.99% or less. Feel free to contact me through my profile if you need more info or help.
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Spinich May 9th, 2010 at 18:20