Does Mortgage Insurance Premium (MIP) last for the term of the contranct on a house?

5 Answers

Relevance
  • 1 decade ago
    Favorite Answer

    There are 2 forms of mortgage insurance:

    1) MI- this is on FHA loans. This is a requirement even if you are borrowing less than 80%. You have to pay this for a minimum of 5 years. If you borrow more than 80% you still have to pay it until you drop to the 80% level but it cannot be less than 5 yrs.

    2) PMI- PMI you have to pay if you borrow over 80% of the homes value. This will automatically drop off when you reach the 80% or you can call at 79% and request it to be dropped.

    • Login to reply the answers
  • Anonymous
    1 decade ago

    Nope you pay it until the balance on your mortgage is below 80% of your current property value.

    Some banks for example, Citibank required that you pay the mortgage insurance for a minium of 2 years.

    Just ask your lender and they'll tell you. Also as of the year 2007 mortgage insurance premium is tax deductable. Good luck!

    • Login to reply the answers
  • Anonymous
    1 decade ago

    I think what you're talking about is PMI (Private Mortgage Insurance). It's mandatory with most lenders until you have at least 20% equity in the property.

    Keep track of it, because they'll keep charging you for it even after you're at 80% LTV if you don't make an issue of it.

    HTH

    • Login to reply the answers
  • 1 decade ago

    I'm not a realtor , but my understanding form my sister, who is is that you can have be removed from the obligation for MIP once the loan to value is less than 80% - not sure if it varies form state to state though. Check with your local Board of Realtors. They can tell you.

    • Login to reply the answers
  • How do you think about the answers? You can sign in to vote the answer.
  • 1 decade ago

    No, it lasts until you can prove that the loan to equity ratio meets a pre-determined level. That is usually 80%. That means on a $100,000 house, your remaining loan amount must be below $80,000. BTW, don't expect them to notice when your house appreciates and you cross their threshold. You will have to inform them of that fact.

    • Login to reply the answers
Still have questions? Get your answers by asking now.