Current Mortgage Rates

Tuesday, December 02, 2008



PMI is insurance that lenders require for borrowers seeking loans of more than 80% of a home's purchase price. PMI protects the lender if default should occur, and enables home buyers with down payments of less than 20% to purchase homes. Generally, if you put down 20% or more, you won't need PMI.

Here's how PMI works:
  1. You have a 5% downpayment.
  2. The lender wants to finance 80% or less of the home's value, since studies show that buyers who put less down are more likely to default.
  3. The lender secures a private mortgage insurance policy for you and closes on the loan. You pay for the PMI policy at closing or (most often) you pay a fee with each monthly loan payment.
  4. If you default, the lender receives the 15% you did not pay at closing.
Once your mortgage loan's loan to value ratio falls below 80 percent, you can eliminate PMI. On a $100,000 home, you would need at least $20,000 in equity to qualify. Contact your mortgage loan lender for details, as the lender will not cancel PMI automatically. You may have to send a written request and get a property appraisal to verify the value of your home.



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Current Mortgage Rates*

Loan Type
National Average
30-yr. fixed5.88%
30-yr. fixed jumbo7.62%
15-yr. fixed5.50%
15-yr. fixed jumbo7.50%
7/1 ARM6.25%
5/1 ARM5.88%
3/1 ARM5.88%
1-yr. ARM6.75%
1-yr. LIBOR ARM6.12%
10/1 ARM7.88%
40-yr. fixed7.00%
*Mortgage Rates Updated: 12/01/2008