Finance
What is the primary purpose of private mortgage insurance (PMI) in Missouri?
ATo protect the buyer from foreclosure
BTo protect the lender if the borrower defaults on a low down payment loan✓ Correct
CTo insure the property against damage
DTo guarantee the seller receives full price
Explanation
PMI protects the lender—not the borrower—against losses if the borrower defaults. It is typically required when the down payment is less than 20% of the purchase price.
Related Missouri Finance Questions
- A Missouri homeowner can request PMI cancellation when the loan balance reaches 80% LTV based on the:
- A Missouri home equity line of credit (HELOC) is secured by:
- The Truth in Lending Act (TILA) requires lenders to disclose the:
- In Missouri, a lender who 'sells' a mortgage in the secondary market transfers to the purchaser:
- Which of the following is a federally chartered secondary mortgage market entity that purchases Missouri conforming loans?
- A Missouri lender charges a 1% origination fee on a $195,000 loan. What is the origination fee?
- In Missouri, the 'Dodd-Frank Wall Street Reform Act' affected residential mortgage lending by:
- When a Missouri borrower assumes an existing mortgage, they:
Practice More Missouri Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Missouri Quiz →