Private Mortgage Insurance (PMI)

Private mortgage insurance (PMI) is largely responsible for the proliferation of the low down payment and zero-down payment mortgage loan programs that can help make homeownership affordable for homebuyers who otherwise couldn’t afford to purchase a home.

The PMI assists homebuyers who can’t come up with a 20 percent down payment by financially protecting lenders in case the minimally invested borrower defaults. Also, the coverage can add hundreds of dollars to the borrower’s monthly mortgage costs.

PMI is no longer required once the property has accrued at least 20 percent equity. The 20 percent goal can be achieved using a few simple payment plans, including paying down the loan, property enhancement improvements, and of course most often through appreciation. In order to cancel PMI, a lender will require proof that the home has grown 20 percent in equity and will require the borrower to submit a professional appraisal report that reflects the growth.


  • Are You Ready to Own a Home?
  • Home Buyer's Step By Step Guide
  • Evaluating Neighborhoods
  • Home Buyer Remorse
  • The Home Inspection
  • The Final Walk Through
  • What You Need to Know about Homeowner's Insurance
  • Home Ownership Pays
  • ThAT Perfect Home: Must-Haves and Wish List
  • The Purchase Offer
  • Why You Should Hire a Realtor:Buyer Benefits
  • Ship-Shape Credit: Keeping Your Finances in Shape
  • It's a Buyers' Market for Investors too
  • Financing Articles Links

  • How Much Home Can You Afford
  • Mortgage Basics
  • Adjustable Rate Mortgages
  • Bridge Loans
  • Capital Gains Tax
  • How Your Credit Score Affects Your Buying Power
  • Debt to Income Ratio
  • FHA Loan
  • Fixed Rate Mortgage
  • Good Faith Estimate (GFE)
  • PMI- Private Mortgage Insurance
  • A Pre-approved Buyer is a Serious Buyer
  • Shopping for Interest Rates
  • The Stated Income/Stated Asset LoaN