Mike sat down with lender Stacy Wolak from INB (NMLS #689948) to talk about Private Mortgage Insurance or PMI.
[00:00:00.000] – Mike Van Cleve
I am here with Stacy Wolak from INB. Stacy is a lender. Stacy and I work together quite a bit. Now, you also… INB might not be a household name, but INB is a local bank.
[00:00:15.640] – Stacy Wolak
Yeah. We’ve been around for over 15 years here in Peoria. We’re right on Knoxville. I’ve been with INB for seven years in the business 24. INB has just been incredible support in the community. That’s why I like working at a bank because my customers can call me afterwards and I can help them with any questions they have and be there to help them. We can remove PMI with an email and a conversation. We can talk about their escrow payment and when your taxes or insurance change each year and your payment adjusts, we can talk about those things, and that’s what I like.
[00:00:53.020] – Mike Van Cleve
Well, let’s talk about PMI for a second because it’s a term that is thrown around a lot. What is PMI?
[00:00:59.490] – Stacy Wolak
Sure. PMI stands for private mortgage insurance. It covers the bank, not the buyer, but it is something you need until you have 20 % down if you’re looking at a conventional loan.
[00:01:11.060] – Mike Van Cleve
I’ve always heard it explained as it’s foreclosure insurance for the sake of the bank. So for some reason, is that accurate?
[00:01:20.540] – Stacy Wolak
Basically, if you’re giving the house back, then it’s going to help us. If you got close to 100% financing, it’s going to help us make up that gap. So that would be a good explanation.
[00:01:31.370] – Mike Van Cleve
Awesome.
[00:01:31.800] – Stacy Wolak
But PMI isn’t the bad word that everybody likes to say it is. I do have to share that. I have a lot of people are like, oh, no, PMI. PMI can actually be tax deductible.
[00:01:42.940] – Mike Van Cleve
Interesting.
[00:01:43.800] – Stacy Wolak
So real estate taxes interest in PMI, of course, up to the government each year. It’s not guaranteed all the time. But if you itemize, it can be tax deductible. The other thing with PMI is over the years, it used to be really high, and now I’ve seen it at $15 a month. It just depends. And what’s impacted by that is your credit. So if you have excellent credit, there’s a top tier for PMI. And then every 20 points, your score goes down, that PMI tier goes up.
[00:02:13.280] – Mike Van Cleve
Interesting.
[00:02:13.860] – Stacy Wolak
But there’s a lot of different factors. If you have two buyers, sometimes the PMI can be lower. Your credit scores, your down payment level. There’s a lot of things that you can do to get that PMI down.
[00:02:25.840] – Stacy Wolak
You can do it as an upfront PMI. You can do it as monthly. You can do it as lendor paid. There are options that you can always discuss and find a way around it. It’s not really the bad word that it used to be. If your scores are in the lower range, around the 620, it is going to be a higher chunk of change. I have had buyers who maybe got their credit fixed and then came back and refinance just to get that PMI tier down. That’s the thing, too. Nothing’s ever permanent, right?
[00:02:56.370] – Mike Van Cleve
Sure. Absolutely. That’s why having a relationship with the lender that you work with is such an important thing, right? Because being able to call you a year, two years after somebody has lived in the home and being able to have that conversation is not something you’re going to get from one of those faceless national syndicated banks. Not that I’m biased or anything, but yeah, I like our local lenders and banks. How does somebody get a hold of you, Stacy?
[00:03:29.620] – Stacy Wolak
Best way is my cell phone 3093031542 and happy to chat anytime. I’m more of an educator than a salesman, so my rule is the only dumb questions are the ones we don’t ask, right?
[00:03:42.030] – Mike Van Cleve
That’s great
[00:03:42.030] – Stacy Wolak
Because we don’t know what we don’t know. So ask away. That’s what I’m here for is just to help walk alongside, answer questions and continue to learn and grow together.
[00:03:54.070] – Mike Van Cleve
That’s awesome.