Q & A: Private Mortgage Insurance

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  1. How do I drop PMI?
  2. What does PMI cost?
  3. What is PMI?

How do I drop PMI?

Private Mortgage Insurance (PMI) is required by lenders if the loan amount is greater than 80% of the home’s purchase price. Based on The Homeowners Protection Act, PMI must be dropped when the loan reaches a stated value of the home’s original purchase value. Speak with your lender to review details of your loan’s PMI stipulations.

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What does PMI cost?

PMI, which stands for Private Mortgage Insurance, is generally required when a down payment of less than 20% of purchase price is put down on a home. Rates vary by lender, but generally PMI is percentage of the loan amount (around .50%). Speak with your lender to confirm the PMI rate you could obtain for your loan.

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What is PMI?

PMI stands for Private Mortgage Insurance, which is a fee lenders add on to loans when borrowers put less than 20% down. This fee serves as added insurance to the lender since the borrower does not have much financial equity in the home.

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