Private Mortgage Insurance is required on conventional mortgages when the down payment is less than 20%. It protects the lender if you default. PMI premiums typically run 0.3% to 1.5% of the loan amount per year and are added to your monthly payment.
PMI is canceled automatically by federal law when your LTV reaches 78% (based on the original purchase price), or you can request cancellation at 80% LTV. If your home appreciates, you can often get PMI removed earlier by paying for a new appraisal.
PMI is one of the main reasons buyers choose conventional over FHA when they have decent credit. FHA's equivalent (MIP) usually lasts the life of the loan unless you put 10%+ down — PMI can disappear with conventional in just a few years.