Finance
A Texas borrower with a 720 credit score and 5% down payment on a $300,000 home will most likely need:
AFHA mortgage insurance only
BPrivate mortgage insurance (PMI) on a conventional loan✓ Correct
CA VA loan guarantee
DNo mortgage insurance because of the high credit score
Explanation
With less than 20% down on a conventional loan, the borrower will need PMI regardless of their credit score. PMI protects the lender in case of default. The rate of PMI will be lower for higher credit scores, but it is still required.
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