What types of loans are covered by mortgage insurance?
Any conventional loan where the borrower makes less than a 20% down payment need to be protected by mortgage insurance. It does not matter whether the loan is a 15-year mortgage or a 30-year mortgage. It also does not matter whether the mortgage loan is an adjustable rate mortgage or a fixed-rate loan. Mortgage insurance also applies to balloon mortgages, purchases, refinance deals and virtually any low down payment mortgage loan. Other programs, such as FHA insured mortgages, contain hybrid forms of private mortgage insurance that are charged to the borrower.
