The Quiz: Buyers that place a down payment of less than 20% often pay what?
Ground rent
Mortgage insurance
Late charge
Negative amortization
Mortgage insurance lowers the lender’s risk of loaning you money. If you put less than 20% down on the purchase, lenders consider you a higher risk and generally require you to also pay for mortgage insurance so that if you fall behind on payments, they won’t lose money.
The correct answer to this quiz is Mortgage insurance.