Today we’ll explain the acronym PMI and why it is important.
Today we’re discussing another real estate acronym: PMI. This stands for private mortgage insurance. Generally, when looking for a loan, if you put down less than 20%, the lender will require private mortgage insurance. It’s simply an insurance policy that will insure the lender against loss in case the borrower defaults.
Many people dislike having to pay for PMI, as it’s an additional monthly expense. To get around it, you can either put more money down when you buy a home, or, if you already have PMI on your loan, you can ask to have it removed once you have more than 20% equity in your home. Speak to your lender about whether or not that will work for you. Also, when you’re looking to buy a house, speak to your lender because some loans allow you to put less money down and not have to pay PMI.
If you don’t know a great lender, reach out to us. We’d be glad to share some of our lending partners’ information with you, and they’d be happy to answer any questions you have.
If you have any questions or real estate needs, call or email us. We’d love to be your real estate resource.