Business / Taxes / Private Mortgage Insurance (PMI): When you buy a home with a down payment of less than 20% of the purchase price, your lender may require you to buy private mortgage insurance (PMI), which protects the lender against the risk that you may fail to repay your loan. The premiums you can expect to pay will vary, but typically come to about 0.5% of the total amount you borrow. For instance, on a $150,000 mortgage, a typical annual PMI premium would be $750, which is 0.5% of $150,000. Divided into monthly payments, this premium would come out to $62.50 a month. You can usually cancel your PMI when you meet certain criteria. Generally, this is when the balance of the mortgage is paid down to 80% of either your home’s original purchase price or its appraisal value at the time you took out the loan. You can check if it’s possible to cancel your PMI by reviewing your annual mortgage statements or by calling your mortgage lender. If you forget to cancel your PMI, your lender is required by federal law to end the insurance once your outstanding balance reaches 78% of the original purchase price or appraisal value at the time you took the loan or you have reached the mid-point of the loan term, provided you meet certain requirements. The lender must give you information about the termination requirement at closing. There are some exceptions to the termination rule, including high risk mortgages, VA and FHA mortgages, and those negotiated before July 29, 1999.
Insurance Verb Synonyms: assurance, surety, indemnity, indemnification, guarantee or guaranty, warranty, bond, security, protection, cover
Private Noun Synonyms: (top) secret, confidential, undisclosed, hidden, clandestine, concealed, covert, surreptitious, off the record, not for publication, unofficial, hush-hush
Private Adjective Synonyms: personal, individual, own, intimate, particular
Business / Finance / Participating Life Insurance Policies: Life insurance that pays dividends to policyholders depending on the company's success as provided by few claims and profitable underwritings and investments. MORE
Business / Finance / Package Mortgage: A mortgage on a house and property in the house. MORE