What is mortgage insurance or private mortgage insurance?
Mortgage Insurance protects a lender if a borrower defaults on a loan. Mortgage insurance is placed on the loan when the borrower does not have a sufficient amount of equity or down payment. For a conventional loan, private mortgage insurance is required on all loans if you are borrowing more than 80% of the purchase price. For FHA loans, mortgage insurance is required on all loans, regardless of the amount of the down payment.
