Many home purchasers are required to buy Private Mortgage Insurance (PMI) when they get a loan on their house.  This insurance is paid by the borrower to protect the lender should the borrower default on their loan and is required on loans that are greater than an 80% loan to value (LTV) ratio.  So, if you buy a $100,000 house and get a $90,000 loan, your LTV ratio is 90%.  Until you’ve made enough principal payments to reduce your principal balance so that your LTV is under 80%, you’ll continue to make PMI payments to your lender.  These can be expensive, running up to around $100 per month depending on the size of the loan, so it’s in your best interest to get rid of this insurance as soon as you can.

If you would like some help determining how to eliminate your monthly PMI payments, take a look at the following:

Cancel Your Private Mortgage Insurance

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