Types of Mortgage insurance
Private Mortgage insurance (PMI)
Private mortgage insurance is provided by a private company rather than the government. This type of insurance is typically required if you are putting less than 20% down on your home. When you get private mortgage insurance, it is usually required that you continue to make payments until you have over 20% equity in your home.
Government Mortgage Insurance
Government mortgage insurance is also known as “FHA mortgage insurance premiums”. If you are getting a loan backed by the Federal Housing Administration (FHA), you will be required to get government mortgage insurance. As with private mortgage insurance, this type of insurance is paid monthly in addition to your mortgage payment, and your downpayment percentage will determine how long mortgage insurance premiums will be required.
Jumbo Mortgage Insurance
Jumbo mortgages may also require mortgage insurance as well if putting less than 20% downpayment. A mortgage is considered to be a jumbo loan if it is greater than $726,200 in 2023 (up from $647,200 in 2022) depending on where you live. Most Jumbo investors will require a 20% downpayment.
Condo Insurance
Condominium units require a specific type of insurance protection that a homeowners policy can’t provide. Condo insurance is paid by the homeowner to protect their unit and personal belongings.
CARSON PAIZ
Elite Group Mortgage Expert
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