A family member was just attempting to get a home loan and they started adding all kinds of "fees" in. One of which was Mortgage Insurance which was over $100 monthly. And NO I'm not referring to Home Owners Insurance, that was yet to be added on. Is this a real thing? Because none of us had ever heard of it and quite frankly thought it sounded like a scam.

Depending on the size of the down payment they might be required to carry mortgage insurance. It is not a scam. Lenders want to be covered as much as possible.































If the buyer is putting a large percentage down then the insurance may not be mandatory.

Private mortgage insurance (PMI) is "real". PMI is often "required" by the lender in cases where the downpayment from the borrower is less than 20%. At 20% or above, it cannot be required.































The "purpose" for the PMI is to "guarantee" pay-off of the mortgage in case the borrower defaults.































Also, once your home value increases to the point where the loan to value ratio is at 78% or less, you can petition your lender to remove the mortgage insurance requirement. I did this when my home increased in value.































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