ALL conventional loans with less than 20% down have what is called "private mortgage insurance" which is basically an insurance policy FOR the bank that pays them if you default. You pay the premiums so it is an added cost of borrowing.
There is ALWAYS PMI on conventional loans with less than 20% down. Any situation with "no PMI" and less than 20% down typically means that you are paying for it with an increase in the interest rate, as opposed to through monthly payments.
Conventional PMI can be removed typically with 20% equity and 2 years of making payments. This is why it TYPICALLY doesnt make sense to take a loan with "no PMI" with under 20% down payment. If you take a higher interest rate and "no pmi" you cannot reduce your interest rate after the 2 years with 20% equity. Therefore it has always been my stance that it is best in most cases to pay a monthly premium that can be removed later.
FHA also has a version of PMI on ALL loans, which is paid no matter how much you put down, but it is more to subsidize their program, as opposed to a true insurance premium.
When you are looking at potential PMI, the most important thing about your transaction is how you structure the loan and PMI. If I can help in any way, please let me know.
WJ Bradley Mortgage