Finance
What is private mortgage insurance (PMI) designed to protect?
AThe borrower against job loss
BThe lender against borrower default on high-LTV loans✓ Correct
CThe property against fire and casualty losses
DThe title against defects
Explanation
PMI protects the lender (not the borrower) against loss if the borrower defaults. It is typically required when the LTV exceeds 80%, meaning the down payment is less than 20%.
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