As an honorably discharged veteran, Austin knows his mortgage insurance rates are lower than regular market...

As an honorably discharged veteran, Austin knows his mortgage insurance rates are lower than regular market rates. His lender is requiring a Loan value of 90% which yields a payment of $1500 per month including PMI of $180 per month. But Austin can only afford a payment of $1300 per month. What can he do?

Expert Solution

One approach is to go for VA loan and it will have lower interest rates and possibly the monthly payment will come within the budget of 1300. If not, VA loan also does not require PMI and it is possible to get a loan without downpayment so the money saved from PMI and downpayment can go towards the amount he is short.

The other approach is to increase the tenure/term of the loan.

jeff jeffy answered 2 years ago

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As an honorably discharged veteran, Austin knows his mortgage insurance rates are lower than regular market...

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