What is PMI on a conventional loan?
PMI is private mortgage insurance — a monthly (or upfront, or split, or lender-paid) charge that conventional loans require when the down payment is less than 20%. PMI protects the lender against default. Cost varies by credit score, LTV, coverage, and property type. Above 80% LTV at closing.
What this actually means.
Conventional PMI structures: 1) Borrower-paid monthly PMI (most common) — added to the monthly payment, removable later under rules; 2) Single-premium PMI — paid upfront in cash, no monthly charge; 3) Split-premium — partial upfront + smaller monthly; 4) Lender-paid PMI (LPMI) — built into a higher rate, can't be canceled later but no monthly charge to borrower. Cost varies by credit score, LTV, coverage percentage, occupancy, and property type. Subject to Fannie/Freddie PMI providers.
What this looks like on a real file.
Where this can move.
Credit score, LTV, coverage percentage, occupancy, and PMI provider can change cost. PMI removal is governed by HPA and servicer policy.
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More conventional questions on PMI.
Educational only. Conventional loan guidelines, lender overlays, rates, fees, PMI, LLPAs, and underwriting requirements can change. Final eligibility depends on full underwriting review. Mortgage Expert, Inc. is not affiliated with Fannie Mae, Freddie Mac, FHFA, or any government agency.