Mortgage PMI vs Lender-Paid Mortgage Insurance Comparison Guide (2026)
Compare borrower-paid PMI vs lender-paid mortgage insurance: cost differences, interest rate impact, cancellation rules, and payment strategy selection.
Summary
PMI options affect mortgage cost differently. This guide compares borrower-paid vs lender-paid mortgage insurance and selection criteria.
Key Steps
- 1Understand borrower-paid PMI: monthly premium, cancellable at 80% LTV, direct payment.
- 2Compare lender-paid MI: higher rate, no monthly PMI, never cancellable.
- 3Calculate break-even: compare PMI cost vs rate increase over loan term.
- 4Consider cancellation benefit: borrower-paid PMI removable, lender-paid permanent.
- 5Evaluate tax treatment: both deductible, lender-paid through higher interest deduction.