If you have the default kind of PMI (private mortgage insurance), you pay for it each month when you make your mortgage payment. So it makes your monthly payment higher than it otherwise could be. The good news is, you don’t have to keep it forever. This article will tell you how to get rid of PMI on your home.
First, What is PMI?
Lenders usually require private mortgage insurance if you put less than 20% down on your home. They are taking on more risk, so they want to be protected. But it’s not like other types of insurance.
That’s because this kind of borrower-paid PMI covers the lender if you can’t make your mortgage payments, not you. But you pay for it each month as part of your monthly payment.
Why remove PMI? In short, it can cost you a lot of money, so that’s a good reason to remove PMI early if you can.
(That money could be going to help you pay off your mortgage faster, for example.)
There are rules in place that can help you get it done.
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