Mortgage calculations

[Qacer]

I'm trying to make sense of sum numbers related to a mortgage. I have the following:

Locked-in interest = 6.5%
APR = 7.1472%
Finance Charge = $260,099.05
Amount Financed = $187,530.80
Total Payments = $447,629.85

It then breaks down the monthly payments as follows:

120 payments - $1,324.43 (includes PMI)
15 payments - $1,232.60 (not sure about the extra $31.67)
225 payments - $1,200.93

I'm not quite sure how they come up with the payments. I tried using the Amount Financed as my loan amount, and I'm getting about $1,185.00 for principal and interest. Originally, the house is priced at $200k and with 5% down the loan is supposed to be $190k.

Any insights? I want to get as much info before I press the lender with some questions.

Thanks!

 

[Rage187]

you forgot insurance and taxes


also here are my details

175,000 for 15 years at 5.25%, 5.55% actual

Payment is $1491 including taxes and insurance, and NO PMI.

 

[Qacer]

Yeah, I purposely ignored insurance and taxes because they normally vary. I just wanted to get the basic principal and interest calculations.

 

[Qacer]

Originally posted by: Rage187
you forgot insurance and taxes


also here are my details

175,000 for 15 years at 5.25%, 5.55% actual

Payment is $1491 including taxes and insurance, and NO PMI.

When did you get this loan and what lender?


My final estimate is around $1700 per month including taxes and insurance. It's a little steep, but hopefully, I can get PMI eliminated in 6 years. Right now, if I don't make extra payments, PMI will go away after 12 years.

 

[Rage187]

We got it in March. We used LoanFinders of Charleston.

Also of note, you should be able to get rid of PMI in 2-3 years.

You are already putting down 5%, your property only has to go up 10%-15% in value before you can call up your lender and tell them to take it off.

 

[Qacer]

Well, Florida is a declining market, so I'm hoping that prices will start to pick up again within 6 years. PMI really takes a big hit on monthly payments. That amount alone can cover student loan payments, so that would be even better if I can get rid of it sooner.

 

[TripleAAA]

Originally posted by: Rage187
We got it in March. We used LoanFinders of Charleston.

Also of note, you should be able to get rid of PMI in 2-3 years.

You are already putting down 5%, your property only has to go up 10%-15% in value before you can call up your lender and tell them to take it off.

If I'm making around $35,000/yr and my mortgage is currently at $139,000 and I've been paying PMI for 2 years, whats my liklihood you think of getting the PMI eliminated? I have very little equity (like 3-4k in principal paid thus far), but I could double that right now if I wanted to with savings money.

Anybody wanna comment on this?

 

[Qacer]

Originally posted by: TripleAAA

Originally posted by: Rage187
We got it in March. We used LoanFinders of Charleston.

Also of note, you should be able to get rid of PMI in 2-3 years.

You are already putting down 5%, your property only has to go up 10%-15% in value before you can call up your lender and tell them to take it off.

If I'm making around $35,000/yr and my mortgage is currently at $139,000 and I've been paying PMI for 2 years, whats my liklihood you think of getting the PMI eliminated? I have very little equity (like 3-4k in principal paid thus far), but I could double that right now if I wanted to with savings money.

Anybody wanna comment on this?

Actually, from what I read, any mortgage obtained from 2007 to this year will have deductible PMI till 2010. If you fall in this criteria, then you can keep your savings till the PMI deduction is over, and then put the minimum payment towards principal that will allow you to eliminate your PMI.

 

[QED]

Originally posted by: TripleAAA

Originally posted by: Rage187
We got it in March. We used LoanFinders of Charleston.

Also of note, you should be able to get rid of PMI in 2-3 years.

You are already putting down 5%, your property only has to go up 10%-15% in value before you can call up your lender and tell them to take it off.

If I'm making around $35,000/yr and my mortgage is currently at $139,000 and I've been paying PMI for 2 years, whats my liklihood you think of getting the PMI eliminated? I have very little equity (like 3-4k in principal paid thus far), but I could double that right now if I wanted to with savings money.

Anybody wanna comment on this?

PMI has nothing to do with what you make. You need to have 20% equity based on the original sales price (or the appraised value if the loan was a refi) to get the lender to remove the PMI. They do not have to eliminate your PMI just because your home appreciated in value sufficiently for you to have 20% equity, although you can refinance at that point and have it eliminated.

For instance, if your original sales price was $143,000, the lender would not have to remove PMI untul your primary balance was below $143,000 * 80%, or $114,400. Depending on your interest rate and payment amount, it could take you 7 to 12 years before you hit that mark.

 

[HannibalX]

If you don't want to pay PMI then you need an additional loan for 20% of the mortgage to use as a down payment. Either that or pay the 20% in cash (best thing to do, if you can't afford the 20% then maybe you shouldn't be buying a house).

Edit: QED beat me to it.

 

[Scarpozzi]

Originally posted by: Pale Rider
If you don't want to pay PMI then you need an additional loan for 20% of the mortgage to use as a down payment. Either that or pay the 20% in cash (best thing to do, if you can't afford the 20% then maybe you shouldn't be buying a house).

Edit: QED beat me to it.

The problem with the 20% additional loan is that it's going to be high interest unless you put your house on it....then you're actually borrowing against your house and, depending on the lender, you might not get a break at all.

Make sure you know what their rules are. I went through a credit union for my home loan and they had all kinds of screwy loans to make sure they got the PMI. If you are able to pay off as much of your loan as possible just to eliminate the PMI, you could actually cut back your payments AFTER you get it paid down. I want to say PMI on my home only added another $100 or so to my monthly payment...but that adds up over time. It's a total scam.

 

[HannibalX]

Originally posted by: Scarpozzi

Originally posted by: Pale Rider
If you don't want to pay PMI then you need an additional loan for 20% of the mortgage to use as a down payment. Either that or pay the 20% in cash (best thing to do, if you can't afford the 20% then maybe you shouldn't be buying a house).

Edit: QED beat me to it.

The problem with the 20% additional loan is that it's going to be high interest unless you put your house on it....then you're actually borrowing against your house and, depending on the lender, you might not get a break at all.

Make sure you know what their rules are. I went through a credit union for my home loan and they had all kinds of screwy loans to make sure they got the PMI. If you are able to pay off as much of your loan as possible just to eliminate the PMI, you could actually cut back your payments AFTER you get it paid down. I want to say PMI on my home only added another $100 or so to my monthly payment...but that adds up over time. It's a total scam.

Oh I agree it isn't a good solution but it's often cheaper than paying the PMI. I have known people who got the loan from family or a CC.

Like I said it's not ideal but some people do it. Again I think if you can't afford the 20% to begin with you might want to keep saving your $$$.

The problem is no one in America saves anymore. They just want instant gratification. Hence the interest only, no down payment loan was born.

 

[ultimatebob]

Originally posted by: Rage187
We got it in March. We used LoanFinders of Charleston.

Also of note, you should be able to get rid of PMI in 2-3 years.

You are already putting down 5%, your property only has to go up 10%-15% in value before you can call up your lender and tell them to take it off.

I thought that I was going to quickly get rid of the PMI on my mortgage as well, until the bottom dropped out of the local real estate market and the value of my condo suddenly dropped 10% in value. So much for any equity that I've put into this place for the past year :|

 

[db]

By contract (between you and lender) PMI is usually mandatory for the first 2 years, no matter what. It sucks. One of many ways the real estate and mortgage industries suck your blood and there's basically nothing you can do about it. This is the power of special interest groups influencing your lawmakers (to keep hands off).

 

[HannibalX]

Originally posted by: db
By contract (between you and lender) PMI is usually mandatory for the first 2 years, no matter what. It sucks. One of many ways the real estate and mortgage industries suck your blood and there's basically nothing you can do about it. This is the power of special interest groups influencing your lawmakers (to keep hands off).

If your lender wants you to pay PMI when you have the 20% down tell him to fly a kite and find another lender because he's trying to screw you.

 

[db]

Of course. PMI is for those with less than 20% down, as others above have stated.

 

[HannibalX]

Originally posted by: db
Of course. PMI is for those with less than 20% down, as others above have stated.

Well then it isn't "no matter what" as you said.

 

[db]

You're taking this personally. I don't think we need to waste other peoples' time nitpicking b/c of insecurities.

 

[GoingUp]

Charter One bank allowed me to put 15% down on my place with no PMI.

 

[HannibalX]

Originally posted by: db
You're taking this personally. I don't think we need to waste other peoples' time nitpicking b/c of insecurities.

LOL You seem to be the insecure person seeing as you don't like being questioned.

Go fly a kite.

 

[Vic]

Originally posted by: db
By contract (between you and lender) PMI is usually mandatory for the first 2 years, no matter what. It sucks. One of many ways the real estate and mortgage industries suck your blood and there's basically nothing you can do about it. This is the power of special interest groups influencing your lawmakers (to keep hands off).

:roll:

It has nothing to do with bloodsucking or special interest groups and everything to do with the risks associated with higher LTV mortgages. You're aware that the federal government has itself been one of the largest mortgage insurers since the 1930s, right? FHA isn't a lender, it's mortgage insurer. And it's self-funding much like the postal service.

 

[QED]

Originally posted by: Gobadgrs
Charter One bank allowed me to put 15% down on my place with no PMI.

Hmm... I used to work for Charter One. Did they make you take out a HELOC to get no PMI?

 

[Vic]

To the OP:
The amount financed is not your loan amount, it is the amount that will go directly to you (or for you, like to purchase the house) after closing costs, etc. The closing costs are subtracted from the loan amount to calculate the amount financed on the Truth in Lending form so that the closing costs can be factored into finance charge figure and thus the APR (which also includes the MI).
Your loan amount is still $190,000. You can see that in your final 225 payments which represent the P&I after the MI is dropped. Your MI looks like it will $123.50 for the first 120 months. Not unusual for your situation. You can petition to have MI dropped after the first 2 years, but the lender will insist on a re-appraisal of the home at your cost, and if the LTV isn't less than 80%, then they don't have to drop it. Exact terms of your MI are dictated by federal law, and the details should be included in your loan document package.

 

[Vic]

Originally posted by: QED

Originally posted by: Gobadgrs
Charter One bank allowed me to put 15% down on my place with no PMI.

Hmm... I used to work for Charter One. Did they make you take out a HELOC to get no PMI?

He probably bought it out. Most people aren't aware that MI doesn't have to paid in monthly premiums. OTOH, most people don't bother with that because "single premium" MI, either paid in cash or in YSP (taking a slightly higher interest rate in exchange of no MI), only makes sense if you're borrowing 85% LTV or lower. MI at that level is pretty cheap to begin with. Above that LTV and it stops making sense to buy it out upfront.

 

[Linux23]

I thought first time buyers don't need to put 20% down?