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LSDefine

Simple English definitions for legal terms

private mortgage insurance

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A quick definition of private mortgage insurance:

Private mortgage insurance, or PMI, is a type of insurance that protects the lender if the borrower fails to repay the loan. It is usually required by the lender when the borrower has a conventional loan and makes a down payment of less than 20% of the purchase price of the house. Without PMI, the borrower would need to make a larger down payment. PMI allows borrowers to make a smaller down payment, but they will need to pay for the insurance.

A more thorough explanation:

Private mortgage insurance, also known as PMI, is a type of insurance that protects the lender in case the borrower defaults on their mortgage payments. PMI is usually required by the lender when the borrower has a conventional loan with a down payment of less than 20% of the purchase price of the house.

For example, if a borrower wants to buy a house for $200,000 and they only have $10,000 for a down payment, they would need to get a mortgage for $190,000. Since their down payment is less than 20% of the purchase price, the lender would require them to get PMI to protect their investment.

PMI can be paid in different ways, such as a monthly premium or a one-time upfront fee. The cost of PMI varies depending on the size of the down payment, the loan amount, and the borrower's credit score.

It's important to note that PMI only protects the lender, not the borrower. If the borrower defaults on their mortgage, the lender can file a claim with the PMI company to recover their losses. However, the borrower would still be responsible for any remaining debt.

Overall, PMI allows borrowers to buy a home with a smaller down payment, but it comes with an additional cost. It's important for borrowers to understand the terms and costs of PMI before agreeing to it.

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MIAMI A
[] AromaticTroubledDormouse
20:55
How does one know if they are UR1 or UR2?
[] AromaticTroubledDormouse
20:56
CONGRATS MACAQUE!
TY
got a random stanford email and almost had a heart attack
ALSO CONGRATS!
Congrats1!
21:15
Miami A, yall I'm so excited I could cry.
21:15
Feel like I can finally stop holding my breath!! Whew!!!
[] baddestbunny
22:16
every time I get accosted by a strange man who follows me around because my male coworkers were too busy talking to walk me back to my car I get closer to saying we need to bring back traditional gender roles
Dkk
22:32
Nice! @Macaque
Dkk
22:32
@Aromatic, Have to guess.
Dkk
22:33
That sucks @Bunny do you have to go to the hospital?
[] baddestbunny
22:40
I said accosted not assaulted
23:35
guys. my notre dame address just went long is this good or bad
1a2b3c4d26z
23:37
Oooooo me too
23:37
omg is this good or bad
Dkk
23:47
Idk if gender roles are gunna fix that then.
23:49
it looks like most people who applied in october last cycle didn't get a decision until january... does it even mean anything that our addresses went long??
hows ED 2 compared to ED 1?
Dkk
0:10
No idea
windyMagician
0:34
reporting live to say my ndls address also went long
does it mean anything ^
Dkk
2:21
NDLS and Fordham took a very long time last year. It's good info for people to know.
[] baddestbunny
4:29
let’s get after it boys and girls
Dkk
5:21
I gtg to bed soon.
Dkk
5:22
Big day today. Gunna be a crazy one. I will sleep through the first half.
good morning lsd it is 5 am EST
also jazzy my ndls address went long ages ago i sadly do not think it means anything
my stanford address also went long LOL i think at most it's an indicator it's under review
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