Private Mortgage Insurance or PMI for Kentucky Mortgage Loans
Help your buyers save thousands over Kentucky FHA Home buyers – and get homes moving faster!
If the answer is yes: A funding option to consider is one of PMI’s rate plans that can save your clients thousands over FHA!
PMI rate plans are a good fit for different borrower situations:
A. Looking to lower the overall monthly payment?
Solution: PMI Super SingleSM is a one-time, upfront payment that can be paid in full at closing, paid with a seller contribution, financed into the loan amount, or a combination of these options.
Benefit over Kentucky FHA: Unlike FHA, there’s no monthly premium with Super Single, so the overall monthly mortgage payment is lower. Plus the borrower can save thousands over FHA based on the total MI obligation paid over 5 years.
Selling tip: You can move homes faster by packaging Super Single with seller contributions up to 3% or up to 6% (depending on the market and the buyer’s down payment). The contribution can be used to help pay the one-time MI premium or both the MI and closing costs.
B. Looking to save cash at closing?
Solution: pmiNU MonthlySM reduces the overall MI obligation because there’s no upfront premium, unlike FHA – which will require an upfront premium of 1% – that must either be paid or financed into the loan amount.
Benefits versus Kentucky FHA: Consider two facts:
- Interest will be paid over time on the added upfront premium on the Kentucky FHA loan amount, which increases the overall loan size, and
- P&I payments are based on the total loan amount times the interest rate.
1Minimum credit score is 680. In distressed markets, minimum credit scores are 680 for LTVs up to 90% and 720 for 95% LTV loans.
2 The numbers presented reflect the annualized premiums, which are billed monthly.
3 30% coverage, 30-year, 4.75% fixed-rate loan, Super Single Non-Refundable Plan, PMI and FHA upfront premiums are not financed, and FHA renewal premium is applied to amortizing balance over 5-year period.
4 30% coverage, 30-year, 6% fixed-rate loan, FHA upfront premium is financed.
Kentucky Private Mortgage Insurance or PMI
- What is mortgage insurance (MI) tax deductibility and how does it work?
- What is the reason for the MI tax-deductibility extension?
- What savings amount can a typical homeowner with mortgage insurance expect?
- How long will this tax deduction be available?
- Do all mortgage borrowers using mortgage insurance qualify for the MI tax deduction?
- What is the income threshold for married homeowners filing separately?
- Is the deduction only for first-time homebuyers?
- Does the MI tax deduction apply to new purchases only or are refinances included too?
- Are there any occupancy restrictions?
- Are investor loans eligible?
- Is there is a loan amount limit?
- Is deductibility applicable for all loan types?
- Does the MI tax deduction apply to lender-paid mortgage insurance (LPMI)?
- When refinancing a piggyback loan, for purposes of the deduction, is the original loan amount considered the sum of the two mortgages or only the primary mortgage amount without the second lien included?
- Who has responsibility for reporting to the IRS?
- If the deduction is taken and subsequently the borrower receives a refund for MI premiums, is that refund taxable as income?
- Do tax deductions have to be itemized on tax returns in order to take the deduction?
Applying the Deduction Kentucky PMI’s Products
- How does the deduction apply to PMI’s Super SingleSM premium in which the premium is financed and rolled into the mortgage loan amount? Can the premium be deducted in one calendar year?
- If a financed single premium is paid by the seller as a concession, who, if anyone, gets the deduction?
Borrowers should consult their tax advisors concerning applicability of this deduction to their circumstances under the Internal Revenue Code and the laws of any other jurisdiction. This information is not intended or written to be used, and it cannot be used, for the purpose of avoiding U.S. federal, state or local tax penalties.
Kentucky Private Mortgage Insurance or PMI
- Type of Kentucky FHA loans available (louisvillemortgageguide.com)
- FHA Home Loans in Kentucky (kentuckyfhaloan.wordpress.com)