Oct
26

Avoid Paying PMI on Chicago Real Estate

October 26, 2011

Now is a great time to buy Chicago real estate thanks to all-time low rates on 30-year fixed mortgages and 15-year fixed loans. If you’re planning on taking advantage of the favorable market, don’t forget about private mortgage insurance.

Private mortgage insurance (PMI) offers limited protection for lenders in case a homeowner goes into default or foreclosure. While this extra cost is an inconvenience, there are ways to avoid paying it. Equifax blogger Sam Tamkin shares some information on

home buying and PMI in “

How to Avoid Paying Private Mortgage Insurance.”

Basically, your down payment will decide whether or not you pay private mortgage insurance. If you can make a 20 percent down payment, on your loan, you can avoid PMI. If you’re refinancing your home, you may also be required to pay of the value of the home has decreased.

While PMI payments are usually made alongside home mortgage payments, you may be able to make a one-time or once-a-year payment instead.

If you don’t think you can afford paying PMI, Tamkin suggests finding a lender willing to give you a first mortgage equal to 80 percent of the home’s value. Then see if the same lender, or a different lender, will give you an equity loan for a portion of the balance to purchase the home. If that doesn’t work, obtain a loan for 80 percent of the home’s value and then see if a family member will loan you the difference.

For more tips on avoiding PMI on Chicago real estate, read Tamkin’s full post on the

Equifax Finance Blog.

About The Author

Read All Stories By Mitch Levinson

Mitch Levinson is the author of “Internet Marketing: The Key to Increased New Home Sales” published by BuilderBooks. He is an Internet marketing expert with expertise in search engine optimization, website development, email marketing, social media and CRM consulting services. He is known for creating effective programs that can be tracked through analytics to prove effectiveness and ROI. Mitch is founder and president of MLC New Home Marketing and MLC FlatFee Realty, as well as managing partner of mRELEVANCE, LLC, a Marketing, Communication, Interactive agency with offices in Chicago and Atlanta. He currently leads the Chicago team. A Multi-Million Dollar Sales Producer who earned an MBA in Computer Information Systems and eCommerce, he brings a unique perspective and experience to the field of real estate communications. Mitch combines the two interests in order to help home builders and developers gain a competitive advantage through the Internet and technology. When he isn’t behind a computer, he enjoys participating in sports and coaching his kids’ teams. Mitch resides in Arlington Heights, Ill., a northwest suburb of Chicago, with his family, which includes two rambunctious labs. Visit my Google+ profile.

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