private mortgage insurance
Low-equity coverage requirement
Private mortgage insurance is insurance that protects a lender if a borrower defaults on a home loan.
Lenders typically require it when the down payment is less than twenty percent of the purchase price.
The borrower pays the premiums but receives no direct benefit—the policy protects only the lender's investment.
Often abbreviated PMI.
Once we had twenty percent equity, we canceled our private mortgage insurance.
- loanBorrowed money repaid later
- lenderOne who loans money
- conventional loanNon-government-insured home financing
- FHA loanFederally insured home financing
- down paymentInitial sum toward purchase
monthly premium · credit score · foreclosure · borrower · first-time buyer · risk management · housing affordability · underwriting · equity · home equity loan · interest rate · credit risk · debt-to-income ratio · closing costs · amortization · appraisal · refinancing · escrow
private mortgage insurancehazard insurance
Protection against property perils
property insurance · title insurance · flood insurance · liability insurance · fire insurance
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