It is universal that the lower the down payment, the more money you need to borrow and the more money you put down the less you need to borrow. Mortgage with less money down typically need to have mortgage insurance, usually loans less than 20% down.

Mortgage insurance benefits the lender, not the buyer. Mortgage insurance is a separate insurance; it is not a life or hazard insurance. It covers the lender in case of foreclosure. Mortgages obtained with little or no money down lenders, take a much bigger risk of losing money. Claims for mortgage insurance are not paid to the borrower, but mortgage insurance benefits the borrower by making it possible for lenders to offer loans with less money up -front. These loans would not be available with out mortgage insurance.

There are two types of Insured Mortgages. I will go into detail about these insurance options next time.