This introductory look at private mortgage insurance details how to pay for PMI and what to consider if your lender requires it. Learn also that you do indeed have the right to cancel your PMI premium and know that private mortgage insurance protects the lender, not you.
PMI is arranged by the lender and provided by private insurance companies. PMI is usually required when you have a conventional loan and make a down payment of less than 20 percent of the home’s purchase price. If you’re refinancing with a conventional loan and your equity is less than 20 percent of the value of your home, PMI is also usually required. There are several different ways to pay for PMI.