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Mortgage insurance is based upon the perceived risk to the lender. Any time you require more than 80% LTV, you will be charged mortgage insurance, or the lender will "self-insure" by increasing the interest rate proportional to the risk. MI is common to conforming loans, and self-insurance is common to some non-conforming loans.
The higher the LTV, the lower your median credit score, and other risk factors will increase the insurance premium. Factors will run as low as .35% to as high as 2% of the loan amount, based on these risk factors.
The cost varies, depending on percent down, type of loan, and amount of coverage.
PMI costs vary from one mortgage insurance firm to another, but premiums usually run about 0.50 percent of the loan amount for the first year of the loan. Most PMI premiums are a bit lower for subsequent years. The first year's mortgage insurance premium is usually paid in advance at the closing.
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