What Is A Private Mortgage

Answer for "What is a private Mortgage?"

Brenda Cole
  Long & Foster Real Estate

Private mortgage insurance is insurance that protects mortgage lenders against default on loans by providing a way for mortgage companies to recoup the costs of foreclosure. PMI is usually required if the down payment is less than 20 percent of the sale price. Homebuyers pay for the coverage in monthly installments. PMI is usually terminated when the homebuyer has built up 20 percent equity in the property.

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