I understand that if one to take a mortgage without a 20% down payment, then the mortgage lender will require to pay Private Mortgage Insurance. From reading around I found out that the PMI is a set percentage of the loan amount.
From my understanding of PMI payments, if one to take a $400,000.00 mortgage loan, with PMI rate of 0.25%, then the annual PMI payment should be:
400,000.00 * 0.0025 = 1,000.00
And in turn, it should be about $83.33 per month.
But the mortgage officer threw out there a rough number of $300.
Did I calculate it right? Is there a different equation?