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Richard Ciemny
Richard Ciemny is Vice-President, Director & Branch Manager of The First National Bank of Anthony, Wichita Branch. Richard has been in the banking profession for many years in the Wichita area. He has been an active member of the Kansas Bankers Association and the Community Bankers Association of Kansas. The First National Bank of Anthony, Wichita Branch, is located at 10111 W. 21st St. North. You may contact Richard at (316) 721-9000.
Banking & Finance
2002-09-01 10:32:00
What is PMI insurance?
Richard Ciemny Question: What is Private Mortgage Insurance(PMI)? Can it be avoided?Answer: PMI or Private mortgage insurance is normally required when you buy a house with less than 20% down. Mortgage insurance helps protect the lenders against foreclosure and is provided by a private mortgage insurance companies. It enables lenders to accept lower down payments than they would normally accept. In effect, mortgage insurance provides what the equity of a higher down payment would provide to cover a lenders losses in the event of a foreclosure.The cost of PMI increases as your down payment decreases. For example, the cost of PMI for a 10% down payment is less than the cost of PMI for a 5% down payment. Your PMI payment is normally added on to your monthly payment.The decision to cancel your private mortgage insurance rests with the  lender. However, in most cases, the lender will allow cancellation of mortgage insurance when the loan is paid down to 80% of the original property value.To cancel the PMI on your loan, contact your lender to determine what requirements must be met.
 
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