What is Mortgage Insurance (PMI)? | Santander Bank - Santander
What is Mortgage Insurance (PMI)?
How Does Mortgage Insurance Work?
A traditional down payment of 20% of the purchase price demonstrates a lower risk to the lender of a borrower defaulting. It indicates, along with other factors considered in the mortgage application process, that the borrower has steady income to afford the down payment. The down payment also covers foreclosure costs for the lender if the borrower does default.
While you can apply for a mortgage with a down payment of less than 20%, this puts the lender at greater risk. The lender may require you to purchase mortgage insurance to lower their risk and offset any costs they may face if you default on your mortgage.
How Much Does Mortgage Insurance Cost?
Do I Need Mortgage Insurance?
All loans are subject to approval.
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