Mortgage Insurance
Defined by Onias Derilus, Mortgage Capital · NMLS# 1859012 · Florida licensed mortgage broker
Mortgage insurance protects the lender against loss if the borrower defaults, and is required on low-down-payment loans.
What Mortgage Insurance means
Conventional loans use private mortgage insurance (PMI) that cancels at 20% equity. Meanwhile, FHA loans carry their own premiums that often last the loan's life. The cost depends on credit and down payment.
Florida example
A Florida buyer putting 5% down on a conventional loan pays PMI until the balance reaches 80% of value, then requests cancellation. An FHA borrower instead pays MIP that usually doesn't drop off.
What it is
Mortgage insurance protects the lender if a borrower stops paying. It is usually required when your down payment is under 20%.
On conventional loans it is called PMI. On FHA loans it is called MIP.
How to remove it
On conventional loans, PMI can drop off once you reach enough equity. FHA mortgage insurance often stays for the life of the loan.
We show you how to reach the point where it falls away. Apply now and we will map your path to drop it.
Related program: Learn more →