Things can go wrong for your mortgage payment. You might found your self unable to pay your load payment. This is where private mortgage insurance is usefull.

When you first buy your home, most lenders expect you to pay a large down payment of at least 20 percent or get some kind of insurance loan protection program that’s called private mortgage insurance. This insurance coverage will protect the lender just in case you are unable to make your monthly payments. Also be prepared, even if you don’t need it, it doesn’t hurt to get private mortgage insurance. Disaster can happen any time.

Typical rates are $55/mo. per $100,000 financed, or as high as $1,500/yr. for a typical $200,000 loan. This insurance is also tax-deductible in 2007 in the USA. The original law was extended in 2007 to provide for a three-year deduction, effective for mortgage contracts issued after December 31, 2006 and before January 1, 2010.