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Today I'm here with Armando Novelo who is a loan officer with
Residential Bancorp. He's going to fill us in on some changes that have
occurred lately with the private mortgage insurance (PMI) rates.
One
thing to be weary of is that mortgage insurance protects the bank, not
the consumer. PMI rates were at 135 basis points, but as of January 26,
2015, they will be lowered to 85 basis points. This is equivalent to lowering the interest rate by half of a point. This is going to improve affordability for a lot of home buyers in Orange County and LA County.
With this sort of change in PMI rates, a person that was looking to
buy a $220K property could now purchase a $250K property for a very
similar rate. That is a difference of $30,000!
However, the change in PMI rates does not only affect potential home buyers. Current
home owners can take their 30-year loan and switch it to a 15-year
loan, increasing their payment slightly but also taking 12-13 years off
of their mortgage.
The fees for a streamline refinance are pretty minimal, and if you have any questions regarding these changes, you can contact Armando at (626) 216-5052, or email him at armando@teamnovelo.com.
As
always, if you have any questions about this topic or any questions or
concerns about Orange County or LA County real estate, then please do
not hesitate to contact me.
