An Ohio borrower is comparing two conventional loan options. Loan A has a 95% LTV and Loan B has an 80% LTV for the same property. Which statement about PMI is MOST accurate?
Correct Answer
A) Only Loan A requires PMI because its LTV exceeds 80%
PMI is required on conventional loans when the LTV exceeds 80%. Loan A (95% LTV) exceeds this threshold and requires PMI. Loan B (80% LTV) does not exceed 80% and therefore does not require PMI.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A trustee sale is a type of foreclosure where a trustee, appointed under a deed of trust, sells the property at auction to satisfy the debt.
Usury is the practice of charging an interest rate that exceeds the maximum rate permitted by state law. Usury laws protect borrowers from excessive interest charges on loans.
A VA loan is a mortgage guaranteed by the Department of Veterans Affairs available to eligible veterans, active-duty service members, and surviving spouses. It offers no down payment and no private mortgage insurance requirements.
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In Ohio, the conveyance fee is paid at the time of:
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Under TRID rules applicable to Ohio mortgage transactions, the Closing Disclosure must be received by the borrower at least how many business days before closing?
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