A different Mortgage question

[TheFalls]

Looking to get a house in probably a year from now...not looking to pay pmi insurance.

Currently going to grad school, so paying down 20% will be tough..10% won't be a problem..

I did read though, that it is a good idea to get a loan for the remainder cash I need to get to the 20% down payment to avoid paying pmi. low int rate of course.

is this true? :think2:

 

[NorthernStar]

You could dive the loan up into a 80% first mortgage and 10% second mortge (either a fixed second or home equity line) then you wouldn't have PMI.
PMI is as bad as you may think. The rates on the second are higher so you need to check which is better. Congress passed a law and made PMI tax deductible. There is also reduced PMI on loans now which makes it even more attractive ( this is a Fannie Mae incentive). Also some private mortgage insurance companies will lower your private mortgage insurance premiums if you take a class on home ownership and managing your money. Tjey are sponsored by counties usually and are either two evenings or on saturday. Worth taking. I had a client who had no credit and couldn't get a second so he had to do one loan and the class cut his PMI by $150 a month. Make sure you establish credit now, have multiple credit cards even if you don't use them..