Private Mortgage Insurance (PMI) allows a borrower to purchase a home with as little as 3% down, or refinance a home with as little as 5% equity. The amount of the insurance premium depends on the LTV and FICO score. AimLoan offers two PMI programs:

  • Borrower Paid Mortgage Insurance (BPMI).  The borrower pays a monthly mortgage insurance premium along with their mortgage payment and the mortgage servicer passes the monthly premiums on to the PMI company. 
     
  • Lender Paid Mortgage Insurance (LPMI).  The borrower takes a slightly higher interest rate and the lender pays a one time upfront mortgage insurance premium to the PMI company.  Since interest is generally tax deductible and PMI premiums are generally not, there may be tax advantages to this option over the more traditional BPMI program.

Compare rates, payments and closing costs for BPMI and LPMI using the Search Rates feature on our website. Enter a scenario with a loan amount greater than 80%, and no greater than 95%, of the property value entered.

The following table summarizes the loan-to-value (LTV), credit score (FICO) and debt-to-income (DTI) requirements to be eligible for PMI:

PMI GUIDELINES
Purpose Property Type Max Loan Max LTV Min FICO Max DTI
PRIMARY RESIDENCE
Purchase SFR/Condo 424,100 97% 620 50%
No Cash Out Refi SFR/Condo 424,100 95% 620 50%
Purchase or No Cash Out Refi SFR/Condo Super Conforming 90% 620 50%
SECOND HOME
Purchase or No Cash Out Refi SFR/Condo 424,100 90% 620 50%
INVESTMENT PROPERTY
Purchase SFR/Condo 424,100 85% 680 50%

AimLoan orders PMI from the PMI company offering the lowest premium for a borrower's particular situation - Click on the below links to view the rates and guidelines of the four major PMI companies currently writing new policies:

MGIC United Guaranty
Genworth Radian

Cancellation of BPMI

By federal law, BPMI on a single family residence or condominium, used as a primary residence or second home, is automatically cancelled on the date the principal balance is scheduled to reach 78% of the value of the property at the time the loan was made.  This date is disclosed in the Truth-in Lending disclosure received at time of application and is generally many years into the amortization schedule.

AimLoan follows Fannie Mae and Freddie Mac guidelines which allow for an earlier cancellation upon a borrower's request when:

Early cancellation based on the original property value

  1. The loan has an acceptable payment record, defined as no payment 30 days or more past due in the last 12 months and no payment 60 days or more past due in the last 24 months.
  2. The borrower pays for a new appraisal, to be ordered by the lender/servicer.
  3. The remaining principal balance is no more than 80% of the lesser of the original property value or the current appraised value.

Early cancellation based on current appreciated property value

  1. At least two years have passed since the loan was originated.
  2. The loan has an acceptable payment record, defined as no payment 30 days or more past due in the last 12 months and no payment 60 days or more past due in the last 24 months.
  3. The borrower pays for a new appraisal of the property, to be ordered by the lender/servicer.
  4. The remaining principal balance is no more than 75% of the current property value if two to five years have elapsed since the origination date or 80% of the current property value if five or more years have elapsed since the origination date.