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Mortgage Insurance Can Reduce Down Payment
If you need a conventional loan, there is a way to put down only 5 or 10 percent. Through the lender, you will be required to buy private mortgage insurance (PMI). This insurance provides protection for the lender in case of default, and allows the lender to approve a larger mortgage amount.

In a common approach, you'd pay an initial amount at closing (often one percent of the mortgage if your down payment is 5 percent, 1/2 of 1 percent if you put down 10 percent). Then, included in your monthly payments for your mortgage, you would pay an additional one-twelfth of 1/4 percent of the mortgage balance. This payment will usually continue until dropped at the discretion of the lender, unless a stop point is specifically written into the deed of trust, such as accumulating a 20% equity. Ask your lender for specific figures for any loan program you are considering, as the amount of mortgage insurance varies by the type of loan.