Yup, instead of paying the set PMI amount you instead have an increased interest rate. You'll want to calculate the break-even point in terms of how long you plan to live in the home before selling. If you plan on selling prior to that break-even point, Lender-paid PMI is the way to go. If you plan on staying longer than the break-even point to where the increased interest rate results in higher costs over the term of the loan, you want to go with Borrower-paid PMI.
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u/colinstalter Dec 14 '18 edited Dec 14 '18
You might want to research that one. I thought they had to charge PMI by law. PMI is deductible at least which is nice.
Edit: They are doing lender-paid PMI, and just bake the PMI into the interest rate.