The Cost Most Buyers Underestimate

 When purchasing a home and figuring their monthly payments, home buyers often underestimate mortgage insurance.  A new study by TD Bank finds that 65 percent of all home buyers underestimate this cost.

 Lenders require private mortgage insurance (PMI) when a buyers downpayment is less than 20 percent of the purchase price. The mortgage insurance protects the lender, who is at greater risk with lower down payments.

 TD Bank found that 43 percent of mortgages in the past two years required PMI at an average cost of $100 per month. About a third of buyers said they felt PMI costs impacted the home they purchased, either making them delay or rethink the purchase of a home.