I don’t understand how making me pay an extra 500$ a month makes me MORE likely to not default on my loan. I live in Southern California and to put 10% down on a house it costs like 170k at least. Anyways I’d love to know why it’s mandatory I pay PMI.
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The bank is taking on a risk when lending out more than 80% of the home’s value. So they make YOU pay for insurance to cover that risk. If you default, that insurance covers the bank. That’s PMI.
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