Finance
In South Carolina, what is the purpose of private mortgage insurance (PMI)?
ATo protect the borrower against job loss
BTo protect the lender if the borrower defaults on a conventional loan with less than 20% down✓ Correct
CTo guarantee the property's value
DTo cover title defects discovered after closing
Explanation
PMI protects the lender (not the borrower) against loss if the borrower defaults on a conventional loan with a down payment of less than 20%. It allows borrowers to purchase with less down but adds to their monthly cost.
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