PASS GEORGIA
REAL ESTATE EXAM PREPGEORGIA REAL ESTATE EXAM GLOSSARY
Private mortgage insurance protects a conventional mortgage lender against part of the loss if a borrower defaults.
Financing
Mortgage finance
Define, distinguish, apply, retrieve
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PASS GEORGIA
REAL ESTATE EXAM PREPGEORGIA REAL ESTATE EXAM
GLOSSARY TERM GUIDEBuild the complete exam definition
Learn the rule, separate it from the nearest distractor, then apply it to a Georgia fact pattern.
What does Private mortgage insurance (PMI) mean?
Private mortgage insurance protects a conventional mortgage lender against part of the loss if a borrower defaults. The borrower commonly pays the premium when the loan-to-value ratio exceeds the lender's threshold.
How do you separate the nearest exam answer?
PMI protects the lender, not the borrower's equity or ability to make payments. Homeowners insurance protects against covered property losses and liability.
What changes or stays the same in Georgia?
PMI is a national financing concept and does not change because Georgia uses a security deed. Federal cancellation rules and loan terms govern actual removal.
A buyer makes a 10 percent down payment on a conventional loan, and the monthly housing cost includes a lender-protection premium.
The party paying the premium is not necessarily the party receiving the insurance protection.
PASS GEORGIA
REAL ESTATE EXAM PREPGEORGIA REAL ESTATE EXAM
GLOSSARY TERM GUIDERetrieve the rule under exam conditions
Answer before reading the explanation. Then explain why every distractor belongs to a different term.
A buyer puts 10 percent down on a conventional loan and pays a monthly PMI premium. If the buyer later defaults and the foreclosure sale falls short of the loan balance, whom does the PMI protect?
- A
The buyer, by covering missed payments
- B
The lender, against part of its loss
- C
The buyer's equity in the home
- D
The seller who received the purchase price
Private mortgage insurance protects the lender against part of its loss when a borrower defaults on a higher loan-to-value conventional loan. The borrower usually pays the premium but is not the insured party. It does not make the borrower's payments or protect the borrower's equity.
Mark each box only when you can perform the skill without looking.
I can define the term in one precise sentence.
I can separate it from the closest look-alike.
I can explain the Georgia rule or confirm that the national rule applies.
I can answer the practice check and explain every option.
PASS GEORGIA
REAL ESTATE EXAM PREPGEORGIA REAL ESTATE EXAM
GLOSSARY TERM GUIDEConnect the term to the wider exam
Use these relationships to move from isolated recall to a connected exam model.
Financing complete lesson
https://www.passgeorgiarealestate.com/study-guide/financing/underwriting
Official exam administration and content-outline source.
https://test-takers.psiexams.com/api/content/bulletin/4672Official implementing regulation for TILA and integrated mortgage disclosures.
https://www.consumerfinance.gov/rules-policy/regulations/1026/