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There are plenty of mortgage insurance options out there.  While no one likes mortgage insurance (that is except the bank giving you the loan) it is a necessary evil.

While you have likely heard of the standard monthly mortgage insurance, you may be surprised to hear you do have options.  Standard monthly mortgage insurance is where you pay a certain amount monthly to pay for your insurance.

Did you know you can also pay for all of your insurance up front?  Some times even finance it in to your loan?  Why would you do that?  Simple lower cost.  If you are going to purchase  and mortgage $200,000 on an owner occupied single family home to 90% and you have better credit, you should expect to pay $86.67 monthly for MI.  That same transaction could have a one time MI payment of 1.35% of the loan amount or $2700.  You could pay the $2700 at closing and not have any further MI payments, but then it would take 31 months to get your money back ($2700/$86) and 5 years to double your money.  Worth thinking about, but what if you could finance that $2700 in to your loan?  You could save $70 a month, how you ask?  Well assuming 6.5% for an interest rate on your mortgage, and a 30 year term, $2700 costs about $16.55 a month, that is $70 less than paying the old fashioned way of paying monthly.

Everyone situation is different.  You may plan to be in a house loan term, and keep the loan long term.  Well financing your MI might be a great idea.  Have short term plans, or know you will be refinancing, paying monthly could be a great idea.  Ask your mortgage loan officer about options.