How To Estimate Mortgage Insurance Premiums

Mortgage Insurance PremiumsProbably the most mysterious part of the mortgage process is mortgage insurance. It will affect most mortgage borrowers, and especially first-time homebuyers so it’s worth knowing something about. You don’t need to be an expert, but it will help to have an idea how to estimate mortgage insurance premiums, since they will be a part of your monthly housing payment.

What is Mortgage Insurance?

Any time a mortgage lender makes a loan in which you have less than 20% equity in the property, you’ll be made to pay mortgage insurance. This is because loans in which the owner of the property has less than 20% equity are considered higher risk loans, with a higher likelihood of default.

In order to make such loans, the mortgage lender will get the mortgage insurance company to provide an amount of mortgage insurance that effectively lowers the mortgage loan to something below 80% of the property value. Mortgage insurance may lower the effective loan balance from say 95%, down 68% of the property’s value.

If you have less than 20% equity in the house that you are either buying or refinancing, you will be required to take mortgage insurance as part of the mortgage. You’ll have to pay monthly premiums for the coverage, and it will be included in your monthly mortgage payment.

What Mortgage Insurance Isn’t

Mortgage insurance is sometimes confused with mortgage life insurance which is actually a completely different form of insurance. Both pay the lender, but one pays in the event of default, while the other pays as a result of death.

Mortgage insurance actually insures the lender for a certain percentage of the mortgage. In the event that you default on your mortgage, the mortgage insurance company will pay a claim to the lender. The fact that the mortgage insurance company has made this payment does not relieve your burden, as the borrower, to make good on the full amount of the loan. It only reduces the mortgage lender’s risk in the event of your default.

Mortgage life insurance is coverage that you purchase that will pay off your mortgage in the event of your death. The proceeds are paid directly to the mortgage lender when you die, relieving your dependents of the need to pay the loan.

Factors that Affect Mortgage Insurance Premiums

When it comes to mortgage insurance premiums, there is no one-size-fits-all. Rates are based on factors that include some or all of the following:

  • Loan-to-value ratio, or LTV
  • Credit scores
  • Type of loan
  • Insurance coverage percentage required by the lender or loan program
  • Loan term
  • Loan amount
  • Type or use of property
  • Refinance and cash out refinance
  • Type of premium plan

Like most types of insurance coverage, mortgage insurance is determined by a matrix of factors reflecting the considerations above. It’s a complicated calculation for a person not familiar with the process, but there are some rules of thumb to apply to typical borrowers.

How Much Does Mortgage Insurance Cost?

There are several mortgage insurance companies, including MGIC, RMIC and PMI. Despite the number of providers, premium rates are fairly standard across the industry.

Rates will vary based on all of the factors above so it’s impossible to generalize exactly what your premium might be. But you can use the following as a rule of thumb based on several common loan characteristics, including a 30 year fixed rate loan not exceeding $417,000 on an owner occupied single family home, where the borrower has credit scores between 680 and 719.

Based on those characteristics and the loan-to-value ratios below, the typical annual premiums will look like this:

80.01% to 85.0% – .43%
85.01% to 90.0% – .62%
90.01% to 95.0% – .94%
95.01% to 97.0% – 1.10%

You can calculate your monthly mortgage insurance by multiplying one of the factors above by your loan amount and dividing it by 12 months. For example, let’s say you’re taking a $200,000 mortgage that is 95% of the value of the home you are buying or refinancing. Your premium rate factor will be .94%, or $1,880 ($200,000 X .94%) per year. By dividing that number by 12 months, your monthly premium will be $156.67.

The good news is that as the balance of your loan declines, so will the monthly mortgage insurance premium. When your loan falls to 78% of the original property value, the insurance can be terminated.

Depending upon your loan terms and credit profile, the actual premium will be different. But the rates above will give you a basic estimate to work with until more complete numbers can be determined.

If you’d like to get more specific numbers you can check out the MGIC Rate Card.

FHA Mortgage Insurance Premiums

Loans backed by the Federal Housing Administration (FHA) calculate mortgage insurance differently. The typical FHA 30 year loan has an upfront mortgage insurance premium of 1.25% of the mortgage amount, and that premium can be added to the mortgage amount and paid off over the life of the loan. On a loan of $200,000 this would result in an upfront mortgage insurance premium of $2,500.

In addition, FHA also adds a monthly mortgage insurance premium based on an annual rate of .55% of the mortgage amount. On a loan amount of $200,000, that would be $1,100 each year, or $91.67 per month. But this amount will decline gradually since it is based on the remaining mortgage balance, which is itself being paid down a little each month.…

Witch of Wall Street – Hetty Green

Hetty GreenAmerican Heritage Magazine compiled a list of the forty wealthiest American’s of all time. The list has thirty-nine men and one woman.

Hetty Green, nicknamed “The Witch of Wall Street” (hum, wonder if a not-so-successful man came up with that one?) inherited $7.5 Million in 1864 when she was 30 years old. When she died in 1916 at the age of 81 she had grown her Net Worth to somewhere between $100 – $200 Million, making her the richest woman in the world at that time.

She was famous for her thrift, frugality, and miserly ways. Most of the stories about her now are negative, probably partly thanks to her “World’s Greatest Miser” entry in the Guinness Book of World Records. However, Hetty: The Genius and Madness of America’s First Female Tycoonis suppose to have a more complete view of Heddy. I am looking forward to ordering and reading this one.…

Fast Cash Advance: really fast and convenient

Fast Cash Advance Loans

Let’s check if the cash advance is so fast and convenient as they represent. Unexpected things can happen when you are mostly unprepared to them.

Fast Cash Advance: really fast and convenient cashFast cash advance can be divided into 2 types. The first one is a payday loan. And the other one is the title loan. You can borrow money on the base of equity you have in a car. This type of quick cash advance is good for those who need a big amount of money, more then $500 up to $1,500. Depending on your car general condition and market value, a lender can decide what sum of money can be lent to you. Again you will need to fill out an application form on lender website where you should point out such things as employment, age and insurance.

Availability

Fast cash advance gives you an opportunity to access to your cash any time you need it. Cash advance online is the best variant for those who want to have some sum right here and right now. You can just send a request, apply for a form, and your account will be deposited within 24 hours after you get account confirmation and approval.

Speed of Fast Cash Advance Loans

When any unexpected situation happens, you will likely borrow money from friends, as this can be the last day of your close  relations, you know. No one likes lending money. For this purpose fast cash advance loans are available 24/7. Cash advance loans are fast in comparison with most types of loans. What makes the service be so fast? First, it is easy qualification requirements. Second, the amount of the loan is small and always available via the Internet. You will get an approval in a few hours or so.

Security

Fast cash advance is secure and safe. To subscribe to this service you need just some things like a regular income, a bank account, and of course, you should be 18 years old. Situations differ, but usually lenders do not ask for fax confirmation, even bad credit will not prevent you from getting quick cash advances. “No fax confirmation” can be explained: as cash is borrowed for a short term, there is no need to ask for any documents via fax for verification of facts. Because of high security level and total confidential politics fast cash advance became very popular. Whatever information you give in the application form, it will be a secret, there is really no need to tell something not true.  Be ready to get a special contract between you and a lender. Pay your attention on the agreement, all fees and interest rates should be involved.

By the way, the reason why you need money so urgently you can keep with yourselves, no one will ask. Another plus is that it does not matter where you are from, what your nationality is or what your job is. Fast cash advance supposes not a big sum to be taken.

Usually, it is no more than $500. Of course, interest is in the focus. Usually for $100 loan you can expect $15-20 more in a couple of weeks. This may seem too much for somebody, but just think of the potential money and time saving, very often this matters.

The only risk is that fast cash advance loans sometimes may have really high charges. That is why, if you would like to use this service, think twice, use it only in emergency cases.

So, next time you are in a trouble, do not give chance for panic to lead your thoughts. You know what to do, just use the Internet or the telephone and get fast cash advance.…

Pay Your Bill Quickly

Online Payday Loan – When You Need Cash

Precisely everyone of us, no matter what the income is, has experienced an urgent need in cash. Such a need may come from an unexpected event, or you might be just short of money to pay a bill. No matter what the reason is, there is a great chance you can’t or do not wish to take these money from your friends or relatives, as there will be questions asked.

So, is there a way to get cash quick and keep it private? There is. All you need to do take a payday loans online at any online lender, and the problem will be solved. There is even no need to get outside the house and go somewhere: you can apply for online payday loan.

Features Of Applying For Loan Online

Payday loans have many features that help them benefit among other types of loans and become more and more popular in US and other countries:

  • online application: you do not necessarily need to go anywhere, as you can simply apply for payday loan online, just fill in the application form on a lender’s website ans click submit. Usually the procedure does not even involve any faxing;

  • exceptionally short procedure: you have the money on you bank account as fast as in 24 hours after submitting the application form, no other loan can compete with this;

  • simple application form: when you apply for faxless payday loans online, all you need to do is fill in an extremely simple application form, you do not need to collect and attach any documents. Basically what you are asked for is some general information and the information on your employment and income;

  • credit history does not matter: whether you have a good or bad credit history, this will not affect the result on your application, as the credit history is tot taken into consideration for cash advance loans;

  • always for your service: you can take a payday loan, then give it back, then take it once more as soon as you need it again,  just make sure you do not miss the repayment term.

Payday loans no credit check are very helpful if you have an unexpected financial problem that needs to be solved immediately. Among other fast cash loans, a payday loan online is the easiest way to get quick cash in your wallet when you happen to be in the need.…

So what does this say about Boston, huh AmEx?

The Boston Herald had this little story in today’s paper: Amex hopes card will be clear choice. The article disclosed that AmEx is test marketing it’s new card – American Express’ Clear card – in Boston and Dallas, before publicizing it nationally. It appears this card was designed using focus groups in Boston & Dallas, so now they want to see how those two cities respond to the finished product. Pretty straight-forward PR type news story.

Three little tid-bits from the article caught my eye.
In fact, the company commissioned a study of top confusions and found that local residents ranked finance problems number two, right behind their careers or jobs.

The largest stress factors for living in Boston included the Big Dig and nor’easters.

Sharnak said the hectic atmosphere and blunt manner of the area’s residents made it an ideal place to introduce the card. “People in New England and Boston just speak their minds,” he said.

First – commissioned a study about top confusions? I would really like to read that full study – oh, wait, maybe not – it might be too confusing…

Second – I buy the stress of the Big Dig – been feeling it for years. There is nothing like driving from point A to point B only to find out all the one-way streets between those points have been reversed and this only dawns on you when half-way down a congested one way the wrong way you are getting the friendly one finger solute from all the folks you just ensnared in a traffic tie-up… But the nor’easter is on the same level? Totally not buying that one. Being strapped to a chair forced to listen to Mayor “Mumbles” Menino state of the city address is far more stressful than a nor’easter (Fine Mayor, but horrible public speaker).

Third – Should I take blunt as a complement? It sounds negative, but nah… Who could say anything negative about the people of Boston? In my book they are clearly the best 🙂…