Private mortgage insurance (PMI) is a type of insurance that protects the lender if the borrower defaults on their mortgage. PMI is typically required when the borrower makes a down payment of less than 20% of the home’s purchase price. PMI can add hundreds of dollars to the borrower’s monthly mortgage payment, so it is important to understand how to avoid PMI payments.
There are a few different ways to avoid PMI payments. One way is to make a down payment of at least 20% of the home’s purchase price. Another way is to get a mortgage from a lender that does not require PMI. Finally, some borrowers may be able to cancel PMI once they have built up enough equity in their home.
