How to Get Rid of PMI on Your Investment Property

Dusty Rhodes • September 18, 2023

When you’re applying for a mortgage, the principal and interest aren’t the only things you need to consider. There are additional upfront closing costs, and there are also ongoing monthly expenses like property taxes, a homeowners insurance premium, and potentially PMI to consider, too.


Out of all these expenses, homeowners have the most control over their PMI, as it’s determined by factors like the type of mortgage you’re using and how much of a down payment you’re bringing to closing.


Many homeowners do end up with PMI. But while it can be pricey, the good news is that you can get rid of it eventually once certain conditions are met. 


What Is PMI?


Private mortgage insurance—or PMI—is insurance not on the home, but on the mortgage itself. It protects the lender if you stop making payments on your home, and it may be required if you take out a conventional mortgage with a down payment under 20% of the home’s purchase price.


It’s also typically required when refinancing a conventional loan if your total home equity is under 20% of the current value of your home. 


What types of loans require PMI?


Conventional loans—including refinancing—require private mortgage insurance if you’re putting less than 20% down when closing on your home. 


Other types of loans do not require PMI, but may have their own type of mortgage insurance. If you use a Federal Housing Administration (FHA) loan, for example, you’ll be required to pay mortgage insurance premiums (MIP), which work differently from PMIs. 


In many cases, your PMI will show up on a monthly mortgage statement, as it’s processed through escrow. 


How Much Does PMI Cost?


PMI costs are determined by the cost of your loan, your down payment, and factors like your credit score. According to Chase Bank, average PMI rates range from 0.22%-2.25%, depending on your credit score. The loan servicer multiplies the cost of your loan by the PMI rate and then divides it by 12 to give you a monthly premium. 


So let’s say your property is worth $500,000. You’re coming to the closing table with $50,000, which is 10% down, and your loan will be for $450,000. The loan officer shares a PMI disclosure form and lets you know that your PMI rate will be 0.60% based on your credit score.


In this case, they could use the following calculation:

[450,000 x .60%] / 12 = $225 monthly mortgage insurance premium payment


Your PMI monthly payments will stay the same for the duration of the policy. 


When Does PMI Go Away?


Private mortgage insurance is not permanent for the lifetime of the loan, thanks to the Homeowners Protection Act, which allows for PMI removal once the LTV ratio is at a certain point. Before this went into effect, PMI could be required for the lifetime of a loan. 


Mortgage lenders automatically end your PMI payments when you’re scheduled to reach a 78% loan-to-value (LTV) ratio, which tells you how much your loan is compared to the value of the property. This will happen if you’re current on all of your mortgage payments, and you’ve made enough in interest payments to own 22% equity in your home.


You can request PMI cancellation once your LTV is 80% or lower. To do this, you can contact the private mortgage insurance company and request termination, but you must be current on your loan. 


How to Get Rid of PMI Early


To get rid of PMI, you must have an LTV ratio of 80% or lower on your loan, and in most cases, this means waiting until your interest payments add up to reach that point.


That said, there are a few different ways of eliminating PMI early because there are other ways to establish and build equity in your home. Let’s look at each. 


1. Reappraise your home


One way to cancel PMI early is to have your home reappraised if you suspect that the property has appreciated past its original value. 


During this process, an appraiser will assess the value of your home. This allows you to leverage any upgrades from remodeling or appreciated value thanks to market conditions in your favor.


If your total home value has increased, it’s possible it’s increased enough that your LTV ratio has reached 80 or under. If so, you can request to cancel PMI with your insurance broker. 


Keep in mind that you’ll need to pay for a new appraisal, which can vary significantly in cost. 


2. Refinance your loan


It’s common for borrowers to have a conventional loan with less than a 20% down payment (and, thus, PMI) because saving for a home while paying rent can be extremely difficult. 


For many, it’s often easier to save more once you’re in the home and have knocked out big expenses like furniture or potential repairs and remodeling. And for investors who start making a profit on the home, it’s much easier to pay down more of the total loan after the fact.


Refinancing your loan essentially creates a new loan, so it eliminates PMI automatically if your new LTV ratio is under 80%. Investors often choose to refinance when interest rates are lower, or they want to essentially make a lump-sum payment that will reduce their month-to-month mortgage payment. 


3. Pay down your mortgage


You have a total monthly payment that includes your principal and interest, and it may also include PMI, property tax, and property insurance. Your total amount of principal and interest payments are impacted by amortization.


You can, however, pay down your mortgage early. The most effective way to get rid of PMI fast is to make principal-only payments as often as you can. Some investors throw extra cash into principal balance payments if they don’t have additional costs on their investment property, while others add extra payments at set intervals to get the loan balance down. 


Just make sure that when you’re making a payment, you’re using “principal-only” payments; paying down the interest early won’t help improve your loan balance and LTV. 


4. Renovate to add value


While it’s always nice when there’s a hot real estate market and your property automatically increases in market value, this can take time and isn’t in your control.


Many investors choose to renovate homes to add value or increase their appeal to potential renters or buyers. If you believe your renovations have added enough value to the home to drop your LTV ratio to 80% or less, get your home appraised.


However, renovations typically do not mean an equal return on your property’s appraised value. You may spend $20,000 on new floors, only to see a $2,000 increased property value (or, depending on the floors you choose and what you replace, may not increase value at all). 


Updating major appliances or “big ticket” rooms like a bathroom or a kitchen are your best bet for significantly increased home value outside a significant home expansion. 



When Are PMI Payments Good for Investors?


PMI can be expensive, and it may feel frustrating for homeowners to be paying extra money every month that doesn’t contribute to their home equity. 


That being said, PMI payments can be good for investors, depending on their particular financial situation and investment strategy.


In some cases, investors may benefit from closing with a small down payment and having an extra monthly payment. Here are some examples.


You don’t have 20% right now 


For starters, some investors may spot a great opportunity but literally can’t show up with a 20% down payment. Others may have the funds but choose to hold some back so that they can make repairs or renovations on a property promptly. 


In these cases, when a real estate opportunity is a great fit, it often makes sense to just secure the home while paying PMI even if it means a small extra monthly payment. 


If this is the case and you can afford the extra monthly payment, it can be a great investment. 


You know profit will exceed PMI payments 


From a cash flow perspective, sometimes you need to spend money to make money. 


Many real estate investors may pinch pennies to acquire initial (or even subsequent) properties, but their cash flow improves dramatically as soon as they can start making a profit.


Say you’re paying $1,000 a month on principal, interest, homeowners insurance premiums, and property tax. Your PMI is $60 a month. You’re able to charge $2,000 a month plus utilities to a renter, giving you a profit (before other costs) of around $940 a month. 


It makes sense to pay $60 a month to secure the home when you can and start earning a profit, which can not only be used to pay down your mortgage balance early if you choose but potentially secure an additional investment property. 


You want to prioritize cash flow 


Any homeowner can tell you that properties can come with significant costs, both expected and unexpected. Putting less money down upfront can leave you more funds to deal with any costs needed to maintain that investment property, whether it’s legal fees during an eviction process or new air conditioning when the old one dies in the dead of summer. 


Cash flow is essential for businesses, so a small monthly payment to earn you some financial flexibility can be a huge advantage. 


PMI FAQs 

Still have questions about private mortgage insurance? We’ve got answers! 


How can you avoid PMI?


If you want to avoid PMI costs, you can come to closing with 20% down. 


You can also look at other financing options. A VA loan, for example, does not require any kind of mortgage insurance premium or a down payment on the home. 


How do I get rid of PMI without refinancing?


PMI is automatically removed from your loan when your loan-to-value ratio reaches 78%. 


Once your loan-to-value ratio reaches 80% or lower, you can request your mortgage lender have it removed. This can happen through standard mortgage repayments, additional principal-only mortgage payments, or increases in your property value due to renovations or appreciation (though the latter requires an appraisal). 


Can I remove PMI if my home value increases?


If your home value appreciates beyond its original value to the point where your LTV is at 80% or under, you can request PMI cancellation. 





Source: Bigger Pockets Blog

Dusty Rhodes Properties is the Best Realtor in Myrtle Beach! We do everything in our power to help you find the home of your dreams. With experience, expertise, and passion, we are the perfect partner for you in Myrtle Beach, South Carolina. We love what we do and it shows. With more than 22 years of experience in the field, we know our industry like the back of our hands. There’s no challenge too big or too small, and we dedicate our utmost energy to every project we take on. We search thousands of the active and new listings from Aynor, Carolina Forest, Conway, Garden City Beach, Longs, Loris, Murrells Inlet, Myrtle Beach, North Myrtle Beach, Pawleys Island, and Surfside Beach real estate listings to find the hottest deals just for you!

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How to Move Out After Selling a House

By Dusty Rhodes • October 13, 2025
From the first coat of paint you used to freshen up your house’s trim to the stress of wrangling your way to a deal, you’ve been through a lot in that place. Now you’ve made it to the final hurdle of selling a home: moving out! Don’t worry, this is the easy part… but you want to do it right. Here’s how to get through the last leg of your journey without any bumps along the way. How to move out on time Once the paperwork is signed at closing, the buyers will officially own the house—and you won’t. That means that, technically, if you or your stuff is still there after the close, “the buyer could evict you,” says Joshua Jarvis , founder of Jarvis Team Realty in Duluth, GA. So make sure to have your exit strategy in place! Still, most buyers will understand if you need a bit more time and have a legitimate reason—like if you can’t move until the weekend due to your work schedule. Just be sure to discuss these issues as soon as possible before the close, so your buyers can plan accordingly. Decide what to leave behind To make sure you’re leaving behind everything the buyer wanted—and that you agreed to—double-check the closing documents . There should be an itemized list of what comes with the house . And even if the buyers didn’t formally request them, it’s just good form to leave certain types of things behind. Such as? “Generally speaking, you should leave anything that’s bolted to the wall,” says Jarvis. “Some homeowners want to take their fans and blinds to the next home, but generally if it’s screwed in, it stays.” Also, if you and the buyers agreed to transfer any services—such as alarm monitoring or pest control —be sure to set that up before you go. Leave the buyers a detailed note in the house, or ask your agent to get in touch with theirs to make sure the transfer goes smoothly. If you do inadvertently take an item that the buyers had requested, they have the right to ask for it back—and they could potentially sue you in civil court for the cost of a replacement. So, when in doubt, feel free to check with the buyers before you grab and go. But don’t leave anything else behind Just as important as what you leave behind is what you don’t. Your buyers have a right to move into a home that’s been cleared of furniture and other movable items they didn’t expressly request. “Some folks leave all kinds of unwanted clothes, furniture, paint cans, and other items, thinking they are helping the buyers,” Jarvis says. If you truly think your buyers might love to have your old planting pots or kiddie equipment, go ahead and ask—but please don’t assume they’ll welcome your leftovers. Even if you’re careful, you might forget something—at which point the buyers may contact their agent to get it back to you, but they also have the legal right to just keep or get rid of it. So double-check areas (e.g., the attic, garage, basement, storage shed, kitchen, and bathroom drawers) where people commonly overlook items. Clean up It’s common courtesy to leave the place not only clear of your possessions but also clean. However, that doesn’t mean you have to leave it immaculate. “Generally, you shouldn’t have to pay to have it deep cleaned,” Jarvis says. In most cases, a simple broom-clean will do. That means wiping down the countertops, cleaning out drawers, sweeping or vacuuming all the floors, and giving the bathroom and kitchen appliances a once-over so the new owners aren’t grossed out when they arrive. Are you forgetting anything? Before you close the door for the last time, run through a quick checklist. Did you eyeball every room for stray items? Have you forwarded your mail and turned off the utilities? Is the water running in the jacuzzi? We all get in a bit of a rush even in the best planned moves, but you won’t be able to get back in, so it can’t hurt to do a final run-through before you move out. Once you’re ready, it’s time to leave. You can drop a line to your real estate agent to let them know you’re out, although it’s usually a courtesy more than a necessity. If you’re feeling truly gracious, feel free to leave a note, card, or bottle of bubbly congratulating the people who’ve inherited your former home. Given all the fond memories you’ve built between those walls, wouldn’t it be nice to start the home’s new owners off on the right foot? And buy yourself some Champagne, too. Make it the good stuff—you’ve earned it. 

When Are You Considered a First-Time Homebuyer Again?

By Dusty Rhodes • October 6, 2025
Buying a home is an exciting time, whether this is your first time purchasing a house or you’re a repeat buyer. But if you’ve owned a home before, you may be wondering if you can be a first-time home buyer again. In some cases, yes, you can. In this Redfin article, we’ll go over what qualifications you need to meet and when you can be considered a first-time homebuyer again. Whether you’re buying a home in Atlanta, GA , or a condo in Portland, OR , read on to find out if you’re eligible to be a first-time homebuyer twice. Key takeaways Usually, you’re a first-time homebuyer again if you haven’t owned a home in 3 years. Some special situations may also qualify you as a first-time buyer. Benefits include down payment and closing cost assistance and lower interest rates. When are you considered a first-time homebuyer again? Typically, you’re considered a first-time homebuyer again if you have not owned a primary residence for at least three years. There are several additional reasons you may qualify as a first-time homebuyer again, which we’ll explore below. Some first-time homebuyer programs have different definitions of “first-time homebuyer,” so check with the specific program before proceeding. Qualifications to be considered a first-time homebuyer There are other reasons you may qualify as a first-time homebuyer twice. Let’s take a look at them: You haven’t owned a primary residence for 3 years: This means if you owned a home, but sold it and rented for 3 (or more) years, you can be considered a first-time home buyer again. If you’re buying with another person, only one of you needs to meet the criteria to use most first-time home buyer programs. You’re a single-parent buying on your own: If you’ve never purchased a home by yourself and are a divorced single-parent, you may qualify again. Even if you purchased a home with your former spouse, you likely still meet the criteria. You’re a displaced homemaker/family caregiver: If you are a displaced homemaker who doesn’t or didn’t earn wages from employment and has only owned a home with a former spouse, you’re likely considered a first-time homebuyer. You previously owned a mobile home: If you owned a mobile home or property not affixed to a foundation, then you likely qualify. Your previous home was out of compliance: If your home had building code violations or safety issues that could not be repaired or brought into compliance for less than the home’s value, you’re likely eligible. Benefits of being a first-time homebuyer again There are benefits to being a first-time homebuyer twice. Let’s take a look at them: Access to first-time homebuyer programs: One of the biggest benefits is the ability to use first-time homebuyer programs such as down payment and closing cost assistance , grants, credits, or loans. Every program has different qualifications, so make sure to research each program or speak with your agent and lender to explore options. Options for low down payment mortgages: There are several loans available for first-time buyers that offer lower down payment amounts. For example, Freddie Mac’s Home Possible and Fannie Mae’s Home Ready offer down payment amounts as low as 3%. Potentially lower mortgage rates: Sometimes, lenders will offer slightly lower mortgage rates to first-time borrowers to help them buy their first home. FAQs about first-time homebuyers Can I be a first-time homebuyer again if I previously owned a home? Yes, as long as you haven’t owned a primary residence in the last 3 years, or you owned a home while previously married. Do both homebuyers need to be first-time homebuyers to qualify? No, in most cases, as long as one homebuyer meets the qualifying criteria, then you’re considered a first-time homebuyer. However, some programs require both homebuyers to be first-timers. Can I qualify for a first-time homebuyer loan again? Yes, for the most part, if you qualify as a “first-time homebuyer,” you can get another first-time homebuyer loan. Every lender and loan is different, so be sure to read the eligibility criteria thoroughly. Are there income limits for programs? Yes, many first-time homebuyer programs have income limits. This means you won’t qualify if you make more than the specified annual amount.

10 Home Renovation Projects Under $1,000 That Add Lasting Value

By Dusty Rhodes • September 29, 2025
Enhancing your living space doesn’t always require a hefty budget. With the right updates, you can add real value to your home for under $1,000. Whether you’re preparing to sell your home in Grand Rapids, MI , or looking for some easy DIY projects for your house in Portland, OR , these cost-effective upgrades can breathe new life into your space. To dig deeper into this topic, we spoke with Kevin Brasler, executive editor at nonprofit Consumers’ Checkbook , a consumer advocacy group that helps homeowners save money and make smart choices. With decades of experience evaluating service providers, Kevin shares insights on how to budget wisely, avoid common renovation mistakes, and know when to hire a professional versus taking the DIY route. 1. Add fresh paint to the walls of your home Painting is one of the most affordable ways to refresh your home. A gallon of quality paint costs $30 to $50, with a full room averaging around $350 . Neutral shades like gray, beige, or white appeal to most buyers, while accent colors such as navy, forest green, or mustard add personality. For a calming vibe, try sage or powder blue. Brasler notes that painting is one of the best DIY-friendly projects homeowners can take on. “Good DIY projects are those that involve mostly labor: painting, basic tile work, installing fixtures that don’t require new wiring or plumbing, landscaping, and most flooring jobs,” he says. 2. Update your cabinet hardware A cabinet hardware update is a subtle yet effective strategy to elevate your home’s functionality and aesthetic appeal. Swapping outdated or generic cabinet handles and knobs for modern, stylish alternatives instantly transforms kitchens and bathrooms. Consider sleek brushed nickel handles for a contemporary touch, or opt for vintage-inspired brass knobs for a timeless charm. This modest investment typically costs between $2 to $10 per piece. 3. Change the kitchen backsplash A new backsplash can quickly refresh your kitchen while protecting your walls. A custom kitchen backsplash protects your walls from daily wear and creates a focal point that elevates the entire room. Opt for affordable ceramic or glass tiles, which can be found for as low as $1 to $5 per square foot. Staying within a $1,000 budget for a standard-sized kitchen is doable with those materials. Or you can go for a peel-and-stick backsplash that is not only budget-friendly, but a quick solution to make your kitchen stand out. Brasler stresses that getting multiple estimates is critical for even small-scale projects like this. “The biggest mistake homeowners make is not getting multiple bids. Even for smaller projects, you should get at least three written estimates; five is better,” he explains. 4. Switch to energy-efficient lighting By making the switch to energy-efficient lighting, you’ll not only improve the sustainability of your home but also create a more comfortable and inviting living environment. Switching to LED bulbs, which typically cost between $2 to $10 each, saves energy and reduces utility bills over time. Beyond the financial benefits, the crisp and vibrant illumination of energy-efficient lighting can effortlessly enhance your home’s overall mood and appeal. 5. Create a beautiful landscape A simple landscaping update is another low-cost project that adds value. Try planting vibrant flowers, shrubs, and trees, which can cost anywhere from $100 to $500, depending on the size and variety. Add mulch or decorative stones to create a polished look for approximately $50 to $150, while adding affordable outdoor lighting options typically range from $50 to $200. Low-maintenance features lower costs down while still making a strong impression. For most landscaping updates, DIY is both practical and cost-effective. Still, Brasler advises calling in professionals for anything involving gas, high-voltage electrical, or structural work. 6. Install a smart thermostat A smart thermostat, such as popular models like Nest or Ecobee, typically costs between $150 to $300, depending on the brand and features. Homeowners can often handle the installation themselves, avoiding additional labor costs. Once installed, these intelligent devices learn your preferences, allowing for automated temperature adjustments, and can be controlled remotely via smartphone apps. 7. Refurbish or paint the front door Refresh your curb appeal by refurbishing or painting the front door – a low-cost project with instant impact. Sanding and restaining often costs under $100 and requires just a few materials. Another choice is to use high-quality exterior paint, which typically ranges from $30 to $50 per gallon, providing a fresh, vibrant color that suits your home’s style. 8. Add floating shelves or built-ins Consider adding floating shelves or built-in storage solutions to maximize space and keep your home organized. Floating shelves, available for as little as $20 to $50 per shelf, provide an affordable and stylish way to showcase decor or organize essentials. For a more customized approach, DIY built-ins can be crafted using plywood or ready-to-assemble shelving units, typically ranging from $100 to $300. 9. Upgrade your kitchen sink and faucet Breathe new life into your kitchen with a sink and faucet upgrade. Faucets usually run $100 to $300, and sinks $200 to $500. Consider a sleek pull-down faucet and a resilient stainless steel or granite composite sink to improve both function and style. Spending $300 to $800 on a sink and faucet upgrade can instantly refresh your kitchen’s look and make daily tasks easier. 10. Add safety measures to protect your home Smart security cameras or a basic surveillance system now offer affordable and effective protection. Investing in a home surveillance system, typically from $200 to $500, allows real-time monitoring and deterrence against potential threats. The addition of smart cameras, with features like motion detection and remote access via smartphone apps, can improve your home’s overall safety and convenience. With a budget-conscious investment of $500 to $1,000, you can create a comprehensive security network covering critical areas of your property. Tips for finding good contractors Even for smaller projects, working with contractors requires careful planning. Brasler emphasizes the value of comparison shopping. “Get proposals and detailed pricing from at least three reputable, licensed contractors,” he advises. “The only way to ensure you’re paying a fair price is to initiate competition.” He also suggests: Check references thoroughly. Ask questions like: Did the company follow plans? Did it finish on time? Was the work professional? Did the contractor offer low-cost solutions and stick to agreed prices? Were problems handled promptly and effectively? Did the team communicate clearly throughout the project? Was disruption to your daily life kept to a minimum? Did the finished results meet your expectations for quality and appearance? Was the contractor flexible and fair about changes if you adjusted plans? Ask neighbors and friends for referrals. Word-of-mouth often uncovers the best local contractors. Look for complaints. Check ratings at Checkbook.org or your local Better Business Bureau and be cautious with online reviews as they can’t always be trusted. Common mistakes when budgeting for small renovations Brasler states the biggest budgeting mistake is skipping multiple bids. “A contractor charging $800 might be using premium materials while the $500 bid uses builder-grade stuff. Try to get prices from each business for the exact same work,” he explains. He also reminds homeowners not to assume that a low price means low quality. “For decades we have evaluated all kinds of businesses and often find some of the best companies have the lowest prices,” he says. When to DIY vs. hire a pro While DIY saves money, Brasler stresses knowing your limits. “Call in pros to deal with anything involving gas, high-voltage electrical, or structural changes. Ditto for work that requires a permit and inspection,” he advises. For tasks like painting, basic landscaping, or adding shelves, homeowners can usually manage on their own. Keep expectations realistic since DIY projects often take longer and may not match professional results. The bottom line Budget-friendly renovations under $1,000 can make a big difference in your home’s look, comfort, and value. From painting and landscaping to updating fixtures and adding smart technology, these projects prove you don’t need to overspend to refresh your space. As Brasler reminds homeowners, “the key is balancing creativity with caution.” By comparing bids, avoiding common budgeting mistakes, and knowing when to call in the pros, you can achieve lasting results without stretching your wallet.