mortgage

What is mortgage insurance?

By the numbers ... 80-10-10 plan

If we compare the purchase of a \$150,000 home under the 80-10-10 plan to a standard fixed mortgage plus mortgage insurance, we find that the former is \$35.36 cheaper each month.

Here's how it works: Under the 80-10-10 plan, the 10 percent down payment on a \$150,000 house is \$15,000. The first mortgage is \$120,000 at 7 percent, which comes to a monthly payment of \$798.36. The second mortgage for \$15,000 has a 9 percent interest rate, making a monthly payment of \$120.69. The total monthly payment for both loans is \$919.05.

With a \$15,000 down payment, one mortgage of \$135,000 at 7 percent has a monthly payment of \$898.16, plus mortgage insurance of \$56.25, making a total payment \$954.41.

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 Product Rate Change Last week 30 year fixed refi 3.46% 0.01 3.45% 15 year fixed refi 2.74% 0.02 2.72% 10 year fixed refi 2.73% 0.02 2.71%

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