Tim Greene

Sales Associate

My Blog

What is Private Mortgage Insurance (PMI)?

4/10/2018

When it comes to buying a home, whether it is your first time or your fifth, it is always important to know all the facts. With the large number of mortgage programs available that allow buyers to purchase homes with down payments below 20%, you can never have too much information about Private Mortgage Insurance (PMI).

What is PMI?

Freddie Mac defines PMI as:

“An insurance policy that protects the lender if you are unable to pay your mortgage. It’s a monthly fee, rolled into your mortgage payment, that is required for all conforming, conventional loans that have down payments less than 20%.

Once you’ve built equity of 20% in your home, you can cancel your PMI and remove that expense from your mortgage payment.”

 As the borrower, you pay the monthly premiums for the insurance policy, and the lender is the beneficiary. Freddie Mac goes on to explain that:

“The cost of PMI varies based on your loan-to-value ratio – the amount you owe on your mortgage compared to its value – and credit score, but you can expect to pay between $30 and $70 per month for every $100,000 borrowed.” 

According to the National Association of Realtors, the average down payment for all buyers last year was 10%. For first-time buyers, that number dropped to 5%, while repeat buyers put down 14% (no doubt aided by the sale of their homes). This just goes to show that for a large number of buyers last year, PMI did not stop them from buying their dream homes.

Here’s an example of the cost of a mortgage on a $200,000 home with a 5% down payment & PMI, compared to a 20% down payment without PMI:

What Is Private Mortgage Insurance (PMI)? | Keeping Current Matters

The larger the down payment you can make, the lower your monthly housing cost will be, but Freddie Mac urges you to remember:

“It’s no doubt an added cost, but it’s enabling you to buy now and begin building equity versus waiting 5 to 10 years to build enough savings for a 20% down payment.”

Bottom Line

If you have questions about whether you should buy now or wait until you’ve saved a larger down payment, meet with a professional in your area who can explain your market’s conditions and help you make the best decision for you and your family.

Fall Maintenance Tips

10/14/2017

As the weather outside continues to remind us, summer is in the past. You may be considering some repairs around the house to prepare it for the cold months of winter. On that note, I've compiled a list of fall maintenance ideas to help you get started!

Gutters and downspouts

Check to make sure they are working properly.

Fireplace and flue

Repair cracks, and crumbling mortar. Check and replace gasket on woodstove if necessary.

Siding

Inspect exterior caulking, and repair if necessary.

Storm windows and doors

Check for any cracked or broken glass. Tighten or repair loose or damaged frames and repaint if necessary. Replace broken, worn, or missing hardware; tighten and lubricate door hinges and closers, and check for broken or missing glazing.

Weather-stripping

Inspect and repair stripping around windows and doors.

Hot-water heating system

Lubricate pump and motor; bleed air from radiators or convectors.

Forced warm-air heating system

Vacuum heat exchanger surfaces; clean and lubricate blower blades and motor; check fan belt tension and adjust if necessary.

Gas burner

Clean burners and ports.

Oil burner

Lubricate fan and motor bearings.

Thermostat

Clean heat sensor, contact points, and contacts; check accuracy and replace if necessary.

Garage Doors

Clean and lubricate hinges, rollers, and tracks; tighten screws.

Foundation

Check grading for proper slope away from foundation wall.

Trees

Trim back all tree limbs and vegetation away from roof.

Heating

For steam heating, check shut-off valve for leaks and drain lower water cut-off per manufacturer's instructions.

Roof

Inspect roof surface, flashing, and eaves; repair if necessary.

Each year, fires kill more Americans than any other natural disaster. According to the U.S. Fire Administration, 80% of fire deaths occur in residences. While no home can ever be completely fireproof, there are many steps you can take to greatly reduce the risk of fire for your family and your home:

  • Smoke detectors are the most important part of your home fire safety! Make sure your home has smoke detectors at least in every bedroom, and test them frequently.
  • Use appliances wisely. Overheating, unusual smells, shorts and sparks are all warning signs that an appliance needs to be shut off and either repaired or replaced. Unplug appliances when not in use.
  • Never overload circuits or extension cords. Don't place cords or wires under rugs, over nails, or in high traffic areas.
  • Portable heaters need at least three feet of space from any combustible materials.
  • Fireplaces should be used with fire screens, and chimneys should have annual cleanings.
  • Have at least two fire extinguishers in your home, with one in a designated place in the kitchen. Cooking fires are the leading cause of both home fires and home fire injuries in the U.S.
  • Extinguish candles before going to bed or when leaving a room.
  • If smoking indoors, always use an ashtray and exercise caution. Careless smoking is the leading cause of fire deaths in the U.S.
  • Properly inspect and maintain your home's heating system. Poorly maintained heating systems cause many fires.
  • Consider the installation of a home sprinkler system. Such systems are now much more affordable and greatly diminish the risk of fire injuries.

These are just a few ways that you can make your home a safer place from fire. More information can be found on the U.S. Fire Administration's website, www.usfa.fema.gov, or by contacting your local fire department. I hope you've found this list helpful. If you're doing any repairs or preventative maintenance that requires the help of professionals, I'd be happy to give you some referrals. I'm also available to answer any of your real estate or home owning questions. You can also find more tips for homeowners on my website! Call if I can be of help to you.

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