Do You Have PMI? Be Prepared To Pay to Short Sale Your Home
If when you purchased you home, you put down less than 20% - you most likely have PMI (mortgage insurance). With the huge number of mortgages in default, PMI companies have been hit hard. PMI companies are party to the short sale transaction and must sign off of the transaction or it won’t happen. In an effort to recover some of their losses, they are frequently requiring some type of payment plan for short sales. These promissory notes can vary in price but are generally a low monthly payment.
Please note that you may not know that you have PMI on your first or second mortgage. Most mortgages are written in such a way that the lender reserves the right to add PMI to a mortgage if they feel it is in their best interest.