What is PMI?
A. PMI operates throughout the world with head-office in the USA. The PMI goal is promotion of the project management profession. Current information about the many benefits of joining PMI may be found at www.pmi.org. Joining PMI is achieved by printing the application form, then posting or faxing the completed form to PMI in the USA. A much faster method is to apply online. Details of both approaches are on the PMI US web site in the Membership section. Note that payment can only be made in $US – the simplest way of doing this is by supplying credit card details on the form. The cost of joining PMI is $US119 plus $10 joining fee, with the cost of joining the Melbourne Chapter an additional $US40 (all on the same form and sent to the USA). The $A cost is determined at the time of processing in the USA, so the exact cost depends on the floating exchange rate at a particular point in time. Many (regional) Chapters and Specific Interest Groups have been formed to support promotion of the
Private Mortgage Insurance (PMI) is required on any first mortgage loan with a down payment of less than 20% of the sales price. PMI covers the lender against loss on the property. PMI can add as much as a couple hundred dollars to your home payment—this is why we encourage borrowers to put down 20% if at all possible.
Private Mortgage Insurance (PMI) is usually mandatory for loans when the ratio of the loan amount to the value of the subject property is greater than 80 percent; that is, 80.01 percent or more of the property is being paid for by the loan. This is known as the loan-to-value ratio, or LTV. Basically, the lower your loan-to-value ratio, the higher your equity in the property will be. You can think of equity as the part of your property you actually own. If you sold your property (for its appraised value), equity is the amount of cash you’d have left after you repay your loan balance in full. Common wisdom holds that the more equity a borrower has in a property, the lower the risk of defaulting on the loan. Thus, Private Mortgage Insurance (PMI) must be paid for lower equity (high LTV) loans to safeguard the lender from possible loan defaults.
Private mortgage insurance is normally required when you buy or refinance a house with less than a 20% down payment. It is a type of guarantee that helps protect lenders against the cost of foreclosure thereby enabling lenders to accept lower down payments than they normally would. The PMI premium is usually added to your monthly mortgage payment.
