PMI is actually insurance policies you to definitely protects the lender-perhaps not you-should you avoid while making payments

Mortgages on Federal Construction Government (FHA) is meant for earliest-go out home buyers who could be with a hard time bringing a conventional financing. This can be officially maybe not a zero-money-down mortgage, because lowest downpayment getting an FHA mortgage try step 3.5%. But that is still rather higher, right?

Well, FHA funds try susceptible to all sorts of more charges and you may criteria, too-like an upwards-front side mortgage insurance premiums (MIP) of 1.75% of your own total financing, along with an annual MIP fee off anywhere from 0.forty five to 1.05% of one’s latest financing balance.