When is PMI required?

Lenders typically require Private Mortgage Insurance (PMI) on conventional loans when your down payment is less than 20% of the home price. PMI protects the lender — not you — and can usually be removed once your loan-to-value reaches 80%.

Is 20% down payment really necessary?

No. Many loan programs allow much lower down payments (FHA from 3.5%, conventional from 3%). A 20% down payment simply avoids PMI and lowers your monthly payment.

PITI stands for Principal, Interest, Taxes, and Insurance — the four components of a typical monthly mortgage payment. When PMI applies, it's often included alongside PITI.