PMI Insurance Quiz

1. What does PMI stand for in mortgage lending?

Principal and Mortgage Interest Private Mortgage Insurance Primary Mortgage Institution Payment Mortgage Insurance

2. When is PMI typically required on a conventional loan?

When the down payment is 20% or more When the down payment is less than 20% Only for first-time homebuyers On all conventional loans

3. What is the typical cost of PMI on a conventional loan?

0.5% to 1% of the loan amount annually 2% to 3% of the loan amount annually 5% of the loan amount one-time $50 per month flat rate

4. How can you typically remove PMI from your loan?

By requesting removal at any time When your LTV reaches 80% or below and you have a good payment history Only by refinancing the loan By paying a one-time fee

5. What type of insurance is PMI designed to protect?

The borrower's home The lender against default The real estate agent The title company

6. What is lender-paid PMI?

PMI that the borrower pays directly to the insurance company PMI where the lender pays the premium in exchange for a higher interest rate Free PMI provided by the government PMI that is tax-deductible

7. What is the difference between PMI and MIP?

There is no difference PMI is for conventional loans; MIP is for FHA loans PMI is paid monthly; MIP is paid annually PMI is optional; MIP is mandatory

Quiz Results