PMI (Private Mortgage Insurance)
Real estateGlossary term
Definition
Insurance required by lenders when down payment is less than 20% of home value. Protects the lender if you default, typically costs 0.5-1% of loan amount annually.
Related terms
- Down PaymentAn upfront payment made when purchasing a large item, typically expressed as a percentage of the total cost. Common for home purchases (usually 3-20%) and auto loans.
- MortgageA loan used to purchase real estate where the property serves as collateral. The borrower makes regular payments over a set term (typically 15-30 years) until the loan is paid off.
Get advice that uses your real numbers
Warren reads your accounts and explains what terms like this mean for your plan. Free to start, no credit card required.