What is Private Mortgage Insurance?

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What is Private Mortgage Insurance?

Postby Alex Chris » Wed Sep 08, 2010 4:04 pm

Private mortgage insurance works a bit differently than other forms of insurance like health or life insurance. To understand how it's different, you first have to understand what it is. Investopedia.com defines private mortgage insurance, which is sometimes abbreviated as PMI, as "A policy provided by private mortgage insurers to protect lenders against loss if a borrower defaults." Yes, you read that correctly; private mortgage insurance is insurance coverage for your mortgage loan provider on which you pay the premium. That's the first difference.

The second major difference between private mortgage insurance and many other forms of insurance is that PMI is not optional. A mortgage lender can require that you, as a homebuyer, pay private mortgage insurance if you do not or cannot afford to make at least a 20% down payment towards the purchase of your home. Though many aspects of your mortgage loan may be negotiable, PMI typically is not; it's usually a condition on unconventional loans.
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Re: What is Private Mortgage Insurance?

Postby lora001 » Mon Oct 11, 2010 4:41 am

Hi, thanks for the Post. can you tell me how much does it cost?
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Re: What is Private Mortgage Insurance?

Postby Delela » Tue Nov 23, 2010 4:34 am

The name sounds posh, but don't let the spiffy name trick you. Private mortgage insurance works a bit differently than other forms of insurance like health or life insurance. To understand how it's different, you first have to understand what it is. Investopedia.com defines private mortgage insurance, which is sometimes abbreviated as PMI, as "A policy provided by private mortgage insurers to protect lenders against loss if a borrower defaults." Yes, you read that correctly; private mortgage insurance is insurance coverage for your mortgage loan provider on which you pay the premium. That's the first difference.

The second major difference between private mortgage insurance and many other forms of insurance is that PMI is not optional. A mortgage lender can require that you, as a homebuyer, pay private mortgage insurance if you do not or cannot afford to make at least a 20% down payment towards the purchase of your home. Though many aspects of your mortgage loan may be negotiable, PMI typically is not; it's usually a condition on unconventional loans
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Re: What is Private Mortgage Insurance?

Postby kindred » Mon Feb 07, 2011 3:43 pm

Private Mortgage Insurance (PMI) is an insurance that protects the lender against loss if the borrower defaults. The good thing about PMI is that it makes it possible for you to purchase a house with as little as a 3-5% down payment, instead of waiting for years to come up with large amounts of money. The catch is, once you have the house, it no longer benefits you. The insurance is basically an additional cost to the borrower for the increased risk held by the lender. It is important to track down your payments and request cancellation of the PMI premiums when the loan-to-value ratio hits 80%.
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Re: What is Private Mortgage Insurance?

Postby Pam_T_Silas » Thu Oct 04, 2012 1:33 am

Alex Chris wrote:Private mortgage insurance works a bit differently than other forms of insurance like health or life insurance. To understand how it's different, you first have to understand what it is. Investopedia.com defines private mortgage insurance, which is sometimes abbreviated as PMI, as "A policy provided by private mortgage insurers to protect lenders against loss if a borrower defaults." Yes, you read that correctly; private mortgage insurance is insurance coverage for your mortgage loan provider on which you pay the premium. That's the first difference.

The second major difference between private mortgage insurance and many other forms of insurance is that PMI is not optional. A mortgage lender can require that you, as a homebuyer, pay private mortgage insurance if you do not or cannot afford to make at least a 20% down payment towards the purchase of your home. Though many aspects of your mortgage loan may be negotiable, PMI typically is not; it's usually a condition on unconventional loans.


Thanx for the post!
Recently Allied Group Insurance Company contact me to insure me but i don;t know about that so i told them to hold some time. I want to know about them and other insurance company so that i can choose from them which is suitable for me. Can you help me about it?
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Re: What is Private Mortgage Insurance?

Postby ZoriWser » Wed Nov 07, 2012 7:15 am

Pmi works a bit differently than other forms of insurance coverage like health or life insurance coverage coverage. To comprehend how it's different, you first have to know what it is. Investopedia.com defines personal home loan insurance coverage, which is sometimes abbreviated as PMI, as "A policy provided by personal home loan insurers to protect lenders against loss if a borrower defaults." Yes, you read that correctly; personal home loan insurance coverage is insurance coverage coverage for your home loan provider on which you pay the premium. That's the first difference.
http://dentalimplantsmanhattan.biz
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Re: What is Private Mortgage Insurance?

Postby jazzalbart » Mon Dec 17, 2012 4:47 am

As I know, it's a policy which is provided by private mortgage insurers to protect lenders against loss. And no doubt, it's very beneficial from a landlord prospective.
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Re: What is Private Mortgage Insurance?

Postby Alex Chris » Fri Dec 11, 2015 2:57 pm

If you put less than 20% down, you will have to pay Private Mortgage Insurance, called PMI. This calculator will tell you how much this will add to your monthly ...
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