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paid: Private Mortgage Insurance vs. Homeowner's Insurance: What's the Difference?
- 09/30/08 01:50 AM
Private mortgage insurance (PMI) protects the mortgage lender if a homeowner defaults.
PMI allows the lender recover some of its costs and losses after foreclosing and selling a repossessed home.
PMI rates vary by loan type, loan size, and loan characteristics. The higher the risk to the bank, the higher the cost of PMI.
Following are two types of PMI:
Borrower-paid mortgage insurance Lender-paid mortgage insurance Borrower-paid mortgage insurance is the more common version of PMI. It may be payable up front, payable monthly, or both. However, once the mortgage balance is reduced to 80% of the home's value, PMI may no longer be required … (5 comments)
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Private mortgage insurance (PMI) protects the mortgage lender if a homeowner defaults. 
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