If homeowners have been dutifully paying mortgage insurance all these years, shouldn’t the mortgage industry be covered in case of disaster? Like now?
Not so much, say industry professionals, who helped me sort out this strange conundrum. It’s strange because private mortgage insurance, or PMI, can be a large chunk of change for many of us.
But it tends to be required if you don’t put at least 20 percent down on your mortgage and that’s a difficult nut to crack with the average home price being well over $200,000.
You, the Good Citizen homeowner, get nothing for your payment, except the privilege of borrowing money. It’s all for the lender, who is supposed to be protected in case you go into foreclosure.