To the homeowners out there... a question for you.

[green91]

Uhh I bought my house with a FTH loan, 10% down, and paid closing costs. I dont have any PMI.

[The Ren]

Uhh I bought my house with a FTH loan, 10% down, and paid closing costs. I dont have any PMI.

Interesting.. I was told by my mortgage consultant all FTH loans include PMI until either 20% is paid or the first 5 years of your loan.

[Jaimecbr900]

OMG, some of you guys really are misinformed.


#1. There are several different First Time Homebuyers programs, so there is not one single rule other than you have to be a first time buyer.

#2. FHA loans ALWAYS have MI. It's called MIP. Even if you have 20% equity, HUD is NOT required (unlike other loan types) to remove that MIP. So there is one of the drawbacks of FHA financing. It has many pluses, but that's one of the minuses.

#3. Paying extra to the principal is NOT going to reduce your monthly payment requirement. Paying extra only decreases the total amount you owe and thereby possibly the total amount of time to pay it off is reduced which in turn reduces the total amount of interest you pay over the life of the loan. The only way paying extra principal will reduce your MONTHLY payment is when you refinance because there is LESS that needs to be borrowed the second go around.

#4. There are plenty of ways to avoid MI. It is just based on what amount you have to put down. You will likely need to get 2 loans vs a single one though.

#5. The MONTLY payment is a simple math equation. There are no hidden trap doors nor mirrors. The amount you owe X the interest rate / length of the loan. That's it. There is no, "pay extra this month and next month it will be less". It does NOT work that way. You have a set payment schedule. That payment schedule does not change unless you refinance the terms of the loan, i.e. get a new loan.

With this said, the only way to reduce your MONTHLY payment amount is one of two ways: Buy LESS or Borrow LESS. That's it. Now, what some people do is that they pay directly to the principal for a few years, their house appreciates, so they refi (it's called rate and term refi when you just refi to lower your payment btw) that lesser loan amount at preferably a BETTER interest rate and THEN they get a lower monthly payment. Although most people that I have seen pay extra to the principal do so to pay off the debt quicker rather than to try and save monthly payments down the road.




Anyway, I hope this helped.

[uproot]

the only way to reduce your MONTHLY payment amount is one of two ways: Buy LESS or Borrow LESS.

Yeah, lol that's pretty much what I was going to say ^