Single upfront PMI costs, is this too much

[Sylvrbak]

Hello All,
Just received an email from my lender in response to my question about paying a one time up front PMI so that I do not have to deal with it monthly. The LO advised the cost upfront would be 11,835.00. I am simply wondering if it is a little on the high side? Can this be negotiated... I was hoping for maybe 8,000 or so.

My deal: Convetional 30 year
Purchase price - 319,600
Down payment - 5%
Mid Mortgage score - 732

Builder and lender incentives are 2k towards closing, plus title policy and 475.00 towards appraisal. Plus 26k towards upgrades....

[DallasLoanGuy]

the lender can shop around and see if another insurance company has a better price.... but it is not negotiable.

[Sylvrbak]

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@DallasLoanGuy wrote:

the lender can shop around and see if another insurance company has a better price.... but it is not negotiable.

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Thanks DLG... I just can't believe it's almost 3.5%. Maybe I should just put that money on the DP keep the 185.00 per month PMI and see if the house builds equity in 2-4 years to cancel it.

[StartingOver10]

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@Sylvrbak wrote:

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@DallasLoanGuy wrote:

the lender can shop around and see if another insurance company has a better price.... but it is not negotiable.

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Thanks DLG... I just can't believe it's almost 3.5%. Maybe I should just put that money on the DP keep the 185.00 per month PMI and see if the house builds equity in 2-4 years to cancel it.

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Good idea^^

Do you have a little extra to bring it to 10% down?  Remember the PMI rate is based on your credit score and the LTV.  Here is a rate card from one of the PMI co's for you to review - there are only a handful of companies across the US. This one is Genworth:  https://mortgageinsurance.genworth.com/RatesAndGuidelines/RateCards.aspx

Here is one from MGIC and it is a little easier to read as the matrix shows both LTV and credit scores in easy to read format: https://www.mgic.com/rates/rate-cards.html

EDIT: LPMI is Lender Paid Mortgage Insurance and BPMI is Borrower Paid Mortgage Insurance

[Sylvrbak]

Yes, I could bring the other 5%, but my goal was to get in the home for as little as reasonably possible...  and walk in the home with my safety fund fully funded for the mortgage and still be able to finish out the home without using my credit (cash only). It appears upfront PMI is not a worth while solution, moving to 10% down makes good use of my cash reserves, But i so hate not knowing which way to go, but I feel a little smarter, and I have another 60 or so days before closing, so a little more time to figure things out

Thanks StartingOver10 for the links, very helpful.

[ArmyWifeMBA]

StartingOver, thank you for sharing the links for PMI.

[StartingOver10]

You're welcome!