Intelligent Equity

Episode 17: Why Mortgage Insurance is a Good Thing with Rob Deters

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In Episode 17 of the Intelligent Equity Podcast, host Ryan Kiefer talks with Rob Deters of MGIC Mortgage Insurance. Rob demystifies mortgage insurance by explaining how it can help first-time home buyers get into a house sooner. Learn about the different types of mortgage insurance that are available, how to remove the insurance and the difference between conventional and FHA loans.

 

Episode Highlights: 

  • Rob was in the wholesale lending business for 15-20 years. He joined MGIC six years ago.
  • Mortgage insurance can actually be a great thing when you’re buying a house.
  • You do not have to put 20% down.
  • If you put down 10-15% instead, then you’ll have the extra to cover costs like replacing the carpet or buying new appliances.
  • Mortgage insurance is much cheaper than it was in the past.
  • There are different ways to pay for mortgage insurance.
  • Monthly is the most common way to pay for it.
  • When you pay monthly, nothing is due at signing which lowers closing costs.
  • There’s also the borrower paid single premium option.
  • If you’re going to be in your house for more than four years, the single premium option is worth considering.
  • There’s also lender-paid mortgage insurance which carries a higher interest rate and is more expensive than the other plans.
  • Rob describes how someone can cancel mortgage insurance and when it automatically falls off.
  • Not all lenders require you to have your insurance for two years.
  • FHA loans require a monthly payment and a one-time premium that’s rolled up into your mortgage.
  • With FHA, you cannot cancel the insurance.
  • You can put as little as 3% down. There’s also down payment assistance out there.
  • Mortgage insurance can help you get into a house sooner.
  • The money you put down is actually getting eaten up by inflation over time.
  • MGIC’s Ready Nest website provides free educational resources for first-time buyers.

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    3 Key Points:


    1. Most buyers try to avoid PMI, but you don’t really need to put 20% down.
  • There are three different ways to pay for mortgage insurance.
  • The biggest difference between conventional and FHA loans is that you cannot cancel the insurance with an FHA loan. 

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    Resources Mentioned:

    • Ryan Kiefer: LinkedIn, Facebook, Website
  • Rob Deters LinkedIn
  • MGIC: Mortgage Insurance
  • readynest.com
    • ...more
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    Intelligent EquityBy Ryan Kiefer
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