Private Mortgage Insurance is associated with Mortgages with less than 20% down on the total Mortgage. It is usually paid by the buyer
but benefits the bank that gives the loan. In a short sale this means yet another party that is involved in the short sale.
This envolves more time for seller and buyer. PMI covers part of the banks loss in a foreclosure. The bank may benefit from a PMI claim. The numbers are important here. Where the bank decides to do a short sale depends on the total picture. Will the bank make a claim? Who is the PMI company? Time and benefit are bank considerations here.
First time buyers with a dead line should be aware.