Question

If you put a down payment on a house of less than 20% of its value, you typically have to pay _____.

penalty points

PMI

mortgage fees

Answer 1

If you put a down payment on a house of less than 20% of its value, you typically have to pay PMI.

Explanation:

If you are able to pay 20 percent down payment, you are not required to pay private mortgage insurance or PMI.

It is a type of mortgage insurance, that you pay when you have a conventional loan as it will protect the lender if you stop making payments on your loan.

Answer 2

The answer is PMI, or Private Mortgage Insurance.

PMI is an insurance policy that protects the holder against loss resulting from default on a mortgage loan while penalty points is part of a point demerit system dealing with driving licences. Mortgage fees are fees charged by a lender for closing a home loan.