One benefit to mortgage insurance is that home buyers can hold back on the cash required for a downpayment and use that for improvements, upgrades or moving expenses which works out to a lower interest rate than a loan to cover the same costs would be.
Private or lenders mortgage insurance can help middle income families into homes that would be cost prohibitive because of the 20-25% down payment required without the insurance. This can be both a benefit and a problems as homeowners may be able to purchase a house that is more than they can actually afford to maintain and keep.
Since a home purchase is the single largest purchase most families and individuals will ever make, shopping around for a mortgage insurance company should be an important consideration. Always get at least five quotes and talk to brokers and agents about various options before making a decision.
