After reading your post I called the loan agent and she didn’t exactly know about the lenght of time for paying PMI for option 2. She will check and call me back but she thinks it is either 2 or 3 years. If the appraisal after 2 or 3 years indicate that I have 20% equity then the PMI stops.
We plan to pay $1500 extra each month to reach that 20% equity. If we are able to do this, which option is better assuming PMI ends in 2 or 3 years?
[quote=Scarlett]I think FHA is out. Option 2:
How many years will you have PMI at this rate?
N
N x $169 x 12 = X dollars
But after N years, your monthly payment goes back to 2159 for the rest (30 – N) years. While the option 3, it stays $2190 for the 30 years. $30 is not that much of a difference, but it can add up over years…. See after how many years you’d have spent the same amount on both option 2 and 3, Y > N.[/quote]
