What is PMI, and is it the same as homeowners insurance?

Private mortgage insurance (PMI) is commonly required on conventional loans with less than 20% down. It protects the lender against certain losses if the borrower defaults; it does not replace homeowners insurance, which covers specified property risks. Government-backed loans may have different mortgage insurance or guarantee fee structures.

PMI cost and cancellation depend on the loan, payment history and applicable rules. For many covered conventional loans, borrowers can request cancellation when scheduled principal reaches 80% of the original value, subject to conditions; automatic termination generally occurs at 78% if the borrower is current. Other paths and exceptions may apply. Fundsitive LLC can explain estimates, while your servicer handles cancellation requests and confirms the rules for your loan.