PMI is essentially an additional payment as part of your mortgage that acts as insurance for the lender of a mortgage if the borrower stops paying back their loan. You’ll only have PMI to pay if you put a down payment of less than 20% on your home.
You can request to have the PMI portion of your mortgage payment canceled once you’ve reached the 20% equity in your home, but the lender is not required to do so, making it that much more important to get to the 20% initially.
If you do need to pay PMI, your lender, not you, will choose the provider of the PMI. In most cases, you won’t know the provider as you make the payment directly to your lender, and they will pass the PMI portion along to the PMI provider.
The first step in calculating PMI is to determine if you’ll need to pay it in the first place. Take your down payment, divide it by the home’s purchase price, then multiply by 100. If you wind up with a number below 20, then you’ll likely need to pay PMI.