Understanding Private Mortgage Insurance (PMI)
Private Mortgage Insurance (PMI) is a type of insurance designed to protect a lender if a borrower defaults on their mortgage.
PMI is often required on home loans when borrowers make a down payment that is less than 20% of the home’s value.
PMI can be a significant factor in the overall cost of a mortgage, adding to the monthly payment. However, it also opens the door for homeownership to individuals who might not have the ability to make a large down payment. It’s important to factor in the cost of PMI when calculating your monthly mortgage expenses and overall budget for a new home.
The good news is that PMI is not permanent. Once you’ve built enough equity in your home you can request to have the PMI removed from your mortgage payment.
Understanding the ins and outs of PMI can help you make more informed decisions about your home loan. If you have questions about PMI or any other aspect of your mortgage, our home loan specialists are here to help. At NIHFCU we’re committed to providing you with the guidance you need to navigate the home loan process confidently. Contact us today for personalized advice and support.
Rates, fees and terms as of April 27, 2024 and subject to change without notice
