PMI is a Recurring Closing Cost or Prepaid Item. When the loan amount is greater than 80% of the property price/value the lender requires you to have insurance on the loan. This protects the lender in case something happens and the mortgage goes unpaid. The lender will then be able to recoup their losses.
About the Author: Vic Joshi
Viral “Vic” Joshi is a native San Francisco Bay Area resident, independent home loan expert and real estate agent, helping home buyers, homeowners, and investors with mortgage loans since 1997. Vic works as an agent with his company, Straight Deal Mortgage, and is still passionate about helping home buyers get the best loan for their circumstances after decades in the business.