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PMI
PMI (also known as private mortgage insurance
and mortgage insurance) protects the lender, if the
buyer defaults on mortgage payments. It is often required for loans with
small down payments (less than 20% of the home's fair market value).
Usually, buyers can avoid this expense by making a larger down payment.
PMI is usually around $55 per month for every $100,000
borrowed (until the principal on the loan falls below 80% of the home's
fair market value). Many mortgage companies
bundle mortgage insurance into the monthly mortgage
payment, along with principal, interest, property taxes, and hazard
insurance.
The various mortgage calculators on this website give users an option - users
can include PMI in the computation, or they can leave it out.