WHAT IS MIP & PMI?

When buying a home, it is easy to get confused with all of the tricky real estate wording that is involved in the process. Making sure that you understand each part of the real estate process can help to ensure that you are buying the right house for your lifestyle and budget.

One of the most important steps in the real estate process is making sure that you have the right loan. The Federal Housing Administration was created to provide insurance to banks to cover approved loans, allowing more people to qualify for a loan. If you meet certain loan standards but do not have enough money for a down payment, you will be required to pay mortgage insurance premiums, or MIPs. You will be required to pay MIP until the loan is refinanced or satisfied in another way. Another option for people who meet loan requirements but do not have enough for a down payment to qualify for a loan is by paying private mortgage insurance, or PMI. The PMI will provide the insurance protection for the loan if the borrower is not able to pay the mortgage.

For all of your real estate needs throughout Northern San Diego, contact the real estate professionals at The Alan Shafran Group. We can help guide both buyers and sellers through the entire real estate process.