Learn how Private Mortgage Insurance works, PMI Cost, how to Avoid PMI, and how to Cancel PMI
Private Mortgage Insurance ( PMI ) is mortgage insurance that refinance lenders require from individuals that borrow more than 80 percent of their home’s value. It protects the mortgage lender from default on the loan and allows refinance and purchase mortgages at up to 100% of the value of the home. Mortgage Insurance is normally paid monthly by the borrower and included with the mortgage payment as a separate amount. So, with PMI, your total monthly mortgage payment can include Principle, Interest, Mortgage Insurance, Taxes, and Homeowner’s Insurance. Beginning in 2007, private mortgage insurance is now a tax-deductible expense.
