What impacts my PMI?
Can you give me examples of what impacts my PMI or mortgage insurance rates? And, does my credit score impact my PMI rate?
I will give you a couple of examples relating to PMI rates at various FICO scores. Keep in mind that there are many variables that can affect your PMI rates in addition to FICO scores:
1.Down payment (a lower down payment will increase the PMI rate you are required to pay).
2.Type of loan (an ARM will typically have a higher PMI rate than a fixed mortgage, a second home will have a higher rate than a primary residence, etc.).
3.The amount of insurance coverage (expressed as a percentage of the loan balance).
To keep things consistent, I’ll give you an example of a $210,000 house/primary residence. The buyer has put 5% down, leaving ~$200,000 in an adjustable rate mortgage. The PMI coverage is 25%.
The approximate rates at the following FICO scores would be:
620+, 0.77% ($128 per month)
600-619, 1.47% ($245 per month)
575-599, 2% ($333 per month)
A pretty big difference!
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I hope this information helps you Find. Learn & Save.
The Latest on Mortgage Rates
No surprise that mortgage rates fluctuate. If you are thinking about purchasing a home or maybe considering refinancing your current mortgage, then you want to be up to date on mortgage rates.
Mortgage rates November 8, 2023
According to Freddie Mac, the 30-year mortgage rate for the week of November 8, 2023 stands at 7.50%. This 26 basis points decrease from the previous week's rate.
Additionally, Freddie Mac reports that the 15-year mortgage rate for November 8, 2023 is 6.81%, indicating a 22 basis points decrease from previous week’s rates.
Note: A basis point is equal to one-hundredth of one percent (0.01%). In numerical terms, if the mortgage rate changes by 20 basis points, it means the rate has changed by 0.20%.
Understanding the impact of mortgage rates on your finances
When it comes to determining your monthly payment, mortgage rates are a key factor to consider. Here are the avergage interest rates (APR) for November 14, 2023 based on Zillow data for borrowers with a high credit score (680-740) in the United States:
- 30-year conventional loan is 7.61%
- 15-year conventional loan is 6.74%
Based on the provided rates, a $279,082 30-year mortgage would result in a monthly payment of $1,972. Alternatively, a 15-year mortgage would require a monthly payment of around $2,468.
Simplify your mortgage journey: Shop around and get pre-approved today!
To make the home-buying or refinancing process a breeze, we highly recommend shopping around for mortgages and getting pre-approved. So, why not Check Out mortgage rates now for the best options available.