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Customer Service > Questions & Answers > Frequently Asked Questions > Personal Banking >

Home Loans (Taxes and Insurance)

What is Private Mortgage Insurance (PMI)?

If a borrower has less than 20% down payment for the property they wish to purchase with a conventional loan, the lender may require the borrower to carry Private Mortgage Insurance (PMI). Private Mortgage Insurance is a type of insurance that protects lenders in the event the borrower defaults on the payment of the loan. Agreeing to carry Private Mortgage Insurance allows the lender to accept lower down payments, and a lower down payment may help the borrower qualify for a loan.