My loan officer is telling me it is going to cost me $203 a month. I've seen rates as low as $65 a month. I also read somewhere that if the house you are borrowing is worth 20% more than you pay for it. You don't have to pay for PMI.

If your equity is less than 20%, PMI will almost always be required. How much it will cost you will depend upon your equity, the size of the mortgage, and often your credit profile. The choice of insurer is up to the lender in most cases; you don't get to shop this around. If you think your lender's insurer is asking too much you'll have to shop around for a different lender.

PMI is based on the amount of the mortgage, so $203 a month sounds about right. PMI rates are heavily monitored by the government with stiff penalties in place for overcharging...I can honestly say I have never seen an overcharge of PMI in my career.

If you are doing 100% financing, then you pay PMI. If you are doing an 80/20 loan, then you normally do not do PMI.

I am curious as to what rate you are getting, because 100% financing programs are on the endangered species list and the couple that I have access to the borrower must have pristine credit.

PMI is not as easy to get rid of as people think it is...just because your home appraises at 80% Loan to Value in a year or so does NOT mean you get to drop the PMI...people that claim that don't know how it works.

They go by your ORIGINAL appraised value at the time you bought the home...that is why people tend to refinance to get rid of PMI.