PMI vs FHA

Conventional Mortgage Insurance vs. FHA

With the recent expansion to Mortgage Insurance guidelines, PMI is becoming more attractive to homebuyers. Typically more affordable for borrowers who put down 10% or more, companies offering PMI are issuing policies on loans up to 97% LTV. They can often match FHA pricing for borrowers putting down as little as 5%.

The following examples are a PMI/FHA comparison using the loan parameters outlined below:

  • $200,000 Sales Price
  • 30-Year Fixed-Rate Loan Term
  • 5.5% Interest Rate
  • 95% LTV
  • 30% Standard Agency Coverage
aaa FHA-Fico 640+ PMI-Fico 680-719 PMI-Fico 720-759 PMI-Fico 760+
Loan Amount $193,000 $194,000 $194,000 $194,000
Up-Front MI
Premium Amount
$3,377
(1.75% premium)
$0 $0 $0
Total Loan Amount $196,377 $194,000 $194,000 $194,000
Monthly MI
Premium Amount
$217
(1.35% premium)
$220
(1.36% premium)
$186
(1.15% premium)
$178
(1.10% premium)
Total Monthly
Payment
$1,332 $1,322 $1,287 $1,279

Use the calculators below to determine how borrowers will fare using an FHA loan or conventional financing with Monthly MI.

Genworth Comparison Calculator

MGIC Comparison Calculator


100% GIFT FUND DOWN-PAYMENT ELIGIBILITY

Genworth and MGIC allow 100% gift funds to meet the minimum 3% borrower contribution required when the following criteria are met:

  • Maximum 41% DTI
  • Fixed-rate/ARM loan*
  • Primary residence
  • Not eligible in FL, AZ, NV or CA (Genworth only)
  • Minimum 740 FICO
  • 1-unit property
  • Soft seconds/subordinate financing not allowed

*ARM loans are only eligible when the initial adjustment period is 5 years or greater. 3/1 ARM loans are not eligible.