What is a PMI?

What does PMI stand for and what is it?

Answer:

PMI stands for Private Mortgage Insurance.

It is an insurance you buy to protect your lender against loss in case you fail to pay a loan. Most lenders require it if you cannot put a cash down of 20% of the purchase price. Its cost about 0.5% of the loan amount the first year and then lower until you have the 20% equity in the home. It is a tax deductible expense since 2007.


Views: 2684        Posted on: May 21 2012        Tags: Mortgage, Insurance