Private mortgage insurance, also known as PMI, protects the lender in case the borrower defaults on their loan. Borrowers tend to try to avoid PMI because it is expensive, and it does not benefit the borrower who pays for it. On the other hand, some borrowers simply cannot buy a house without getting private mortgage insurance. PMI is applied to the outstanding principal when a borrower puts down a payment of less than 20%, and it generally lasts until the loan-to-value (LTV) ratio drops below 80%. If a borrower tries to calculate private mortgage insurance premiums for their loan, they will soon realize that it is expensive, so they should try to avoid PMI as much as possible. If a borrower already has private mortgage insurance, there are ways for a borrower to stop paying for it.

Private mortgage contracts, just like mortgage terms are fixed and need to be renegotiated once the current private mortgage insurance expires. The length of a single private mortgage insurance contract is usually 1 year, but it can be as short as 6 months and as long as 3 years. Generally, private mortgage insurance companies offer multiple terms to fit the largest number of borrowers. This flexibility in term lengths is due to the fact that most mortgage lenders do not require private mortgage insurance once the LTV on the loan reaches 80%, which is equivalent to putting a down payment of 20%.

It is important to note that private mortgage insurance companies may also provide different rates for different term lengths even if the financial situation of the borrower does not change. For example, if a borrower gets private mortgage insurance for 1 year, they may have a better rate if they got private mortgage insurance for 6 months. Generally, mortgage insurance companies prefer issuing longer-term insurance because it provides a larger payoff for a similar amount of work. A borrower who is not planning to surpass the LTV ratio of 80% on their mortgage any time soon, should opt in for longer-term private mortgage insurance to save some money down the road. Getting a short-term PMI is worth only when a borrower is close to lowering their LTV to below 80%. Once the borrower reaches the LTV of less than 80%, their lender may not require PMI anymore. This means that the borrower does not have to pay PMI premiums once LTV is below 80%. For example, if a borrower expects their LTV to be below 80% in 6 months, they may be better off getting private mortgage insurance for 6 months rather than for 1 year.

It is never in the interest of a borrower to pay PMI premiums because it does not protect them, but it protects the lender. Private mortgage insurance can also be very expensive and range from 0.5% to 1.5% of the outstanding principal. For example, if a borrower gets a PMI at a rate of 1% on a mortgage with the outstanding principal of $500,000, the borrower would have to pay $5,000 extra to cover the annual cost of insurance. Even though some people may find enough cash to put a down payment of 20%, many people who cannot cover such a large down payment, are required to get private mortgage insurance that adds up to their expenses.

Every homeowner knows how important it is to have good paint. New paint color for your interior can modernize your home, and exterior painting can prevent moisture from seeping into your home. That is why it is a good idea to repaint your interior walls every few years to keep your home looking good and maintain or increase the value of your home. 

Quality paints can help keep allergens, dust, and filth at bay while also giving your home a lovely appearance. However, finding a painting company that can provide exceptional painting quality may be difficult. And, if you’re not careful, painting your house could end up being one of the most expensive and time-consuming projects you’ve ever undertaken.

So, choosing a company that can get the job done right is an essential step in painting. But how do you know if you’ve chosen the right painting company to work with? In this article, we’ve put together some guidelines to help you make a more informed decision.

Identifying your goals and requirements is the most crucial stage in selecting a reputable painting company that suits your tastes. 

Choose expertise and experience over low-cost offers. 

As a general guideline, avoid selecting a painting company based on price as this could result in subpar painting. 

Aspiring Black homeowners still face more obstacles than other demographics in their pursuit of homeownership, a new report from the online loan marketplace LendingTree has found.

The research found that the denial rate for Black mortgage applicants is almost twice as high as the nation’s average in the country’s 50 largest metropolitan areas. LendingTree based its analysis on data from the 2020 Home Mortgage Disclosure Act, finding that some 18% of Black borrowers have their applications denied when applying for a mortgage, compared to the 9% rejection rate for the overall population.

LendingTree Senior Economist Jacob Channel told CNBC that data shows that a problem does exist. However, he said there are solutions to this problem, meaning that “Black homebuyers shouldn’t lose faith that they’ll never be able to become homeowners.”

The problem varies across the nation. For instance in St. Louis, the rejection rate for Black mortgage applicants was 20.73% compared to the average of 7.3% for the overall population, representing a spread of 13.4%. Other problem cities include Boston and Jacksonville, Florida, which both had a spread of 13.34%.

The best areas for Black mortgage applicants appear to be San Francisco, Sacramento, California, and Seattle, where the spread was just 2.35%, 4.64% and 4.83%, respectively, LendingTree said.

Despite concerns about its sustainability, the real estate market is going through a boom. While the real estate market is focused chiefly on buying and selling built properties, investing in vacant land can also give you good returns. You can purchase vacant land to sell it for profit or to build your ideal house according to your taste. 

Buying or selling a vacant land is a complex procedure that requires you to understand the market carefully. Whether you are buying land to build a house or for commercial purposes, you should keep the following in mind:

1. Work With a Real Estate Lawyer

You might think you have researched enough to buy land on your own, but the real estate market is complex, and the laws around them are too complicated to be understood by a layman. A real estate lawyer can help you deal with the legality of your purchase.

For example, zoning laws are controversial and unclear in their dictation of what you can or cannot use the land for. A real estate lawyer best understands such ambiguities. If you buy the land anyway, you will not be able to use it for the purpose you bought it for if the lot is not zoned for that purpose. There can be other restrictions other than zoning, so having a real estate lawyer can ensure you buy the most suitable land for your needs. 

2. Understand the Cost of Building a Property

If you buy land to build a house or a shop on it, you need to consider your budget before going ahead with the purchase. Land purchases are expensive, and you need to ensure you have enough left to build the property you want. There are also other costs you must factor in when buying land, such as the cost of bringing utilities to your building.