Looking To Buy First Property
I am looking to become a first-time homebuyer by purchasing property from my [parents. Although I am getting a good deal on the property, they are unwilling to provide me with a Gift of Equity Letter because they don't want to deal with any extra hassles beyond signing a sales contract. As a result, I may have to pay PMI if I'm unable to come up with the down payment on my own. Does anyone know of any other way around paying PMI without a 20% down payment?
jlabrey,
Good to meet you! Ask your lender if you can qualify for an 80/20 loan. That is an 80% 1st mortgage and 20% 2nd mortgage. You will have to write two checks a month instead of one but it will get you out of paying pmi and still give you 100% financing. I don't know why lenders won't always take the time to explain all your options, but now at least you know of one more.
Good Luck
LarryNut is exactly right. We use that option all the time to get around PMI. If your mortgage broker didn't bring that up, dump them and find someone that understands your needs.
jlabrey,
Is there any chance of you providing an agreed upon downpayment to your parents and they provide you with owner financing. If they own it free and clear and don't need all the money, they may enjoy collecting the interest that this loan would generate for them.
Just another idea. Good Luck.
Dave
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