This article goes through a step-by-step process on how to correctly enter mortgage insurance (MI)
1. Please go to Overview > Terms and Mortgage
2. If the Mortgage Insurance is single premium (one time MI), please enter the MI percentage in the PMI field (toggle on Lender paid MI if applicable). If it is financed, please leave the amount paid in cash as $0 or enter the amount in excess from the closest whole dollar. If it's not financed, please enter the entire amount in the amount paid in cash field.
Non Financed MI:
3. If the Mortgage Insurance is paid monthly, please enter the MI percentage in the Annual MI Rate field. This will automatically carry over to the MI field in the proposed housing expense section
4. Please go to Additional > Mortgage Insurance Detail section and complete all applicable fields
5. Please note that failure to enter pertinent information such as Coverage, First Renewal Months, First Renewal Payment, First renewal Rate, Second Renewal Months, Second Renewal Payment, Second Renewal Rate, Cut Off , Duration, Renewal Calculation, etc may cause inaccuracies on your disclosures and documents including LE and CD. Please always preview the amortisation schedule in the disclosure tab and/or from your document provider to ensure Mortgage Insurance is calculated correctly
4/23/2023*** Declining MI: MI Cancellation Rule for conventional loans: 1. If a loan is 1 unit primary residence, monthly MI will auto-cancel at 78% LTV or Scheduled Amortization Midpoint Date (No auto cancellation for all others) 2. MI payment priority a) If a loan has a First Renew term, and first renewal rate >0, and first renewal rate>= Loan Annual MI rate, it will be the MI rate for the First Renew term. If the first renewal rate=0 and the first renewal payment >0, then the first renewal payment will be the month MI's first renewal term period. b) If a loan has a second Renew term, and the second renew rate is>0 and the second renew rate, it will be the MI rate for the second Renew term. If the second renew rate=0 and the second renew payment >0, then the second renew payment will be month MI for the second renewal term period 3. Renewal Calculation Declining: if the renewal calculation is Declining, Sys will calculate MI yearly and use the year beginning UPB as the loan amount. If no renew rate but renew payment, sys will always use renew payment