What is PMI?

If you’re buying a home for sale in Riverview and using a loan to do it, you may have to learn about private mortgage insurance, or PMI.

What is PMI?

Private mortgage insurance (PMI for short) is a type of insurance that protects your lender in the event that you don’t make your monthly mortgage payments.

Typically, PMI is required for buyers who are putting down less than 20% as a down payment on a mortgage loan. (Lenders believe that someone who’s willing to put down 20% is more invested in the property than someone who puts down less.)

How to Calculate PMI

Your lender most likely has a calculator you can use to calculate your PMI, but even if it doesn’t, you can calculate a ballpark figure yourself.

First, multiply the loan amount by the insurance rate. If your loan total is $300,000 and your insurance rate is 0.005, your annual mortgage insurance payment is:

300,000 x 0.005 = $1,500.

Are You Buying a Home in Riverview?

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• Riverview homes for sale over $1,000,000

When you’re ready, call us at 813-961-6000. We’ll help you find the right home for your needs!