No one's talking about it, but what about the private mortgage insurance (PMI) or mortgage insurance premium (MIP) bullshit that was supposed to protect the investors from things like this?When I bought my first hous, back in the Pleistocene Age, PMI was the biggest monthly irritant we had. Each month, we had to shell out something like $150 for what was essentially an insurance policy. Once I owned 20% or 25% of the house value, I could drop the PMI. Happy dance time.
So, if PMI is for people who don't have enough principle, why doesn't that cover the forclosure issue? Is PMI "so 1980s" these days?
4 comments:
In the last few years there has been a move to people borrowing 20% from one lender and 80% from another, for 100%. That way you don't have to pay PMI. The 20% is a 2nd mortgage.
I always got the feeling that there was some fibbing involved...
My friend had PMI for her house but she refinanced when prices when prices went up, and got enough money to cover the deposit. I think. Something like that.
We had PMI untill we could afford to re-fi and unload it, but that was over ten (maybe fifteen) years ago.
It's all paid-for now and we get no tax-deduction or stimulations.
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