Are private mortgage insurance and mortgage insurance the same?

Private mortgage insurance (PMI) and mortgage insurance are not the same and refer to different products, which makes this response accurate.

Private mortgage insurance specifically pertains to insurance that protects lenders from losses incurred when a borrower defaults on a conventional loan that has a down payment of less than 20%. It is a policy that secures the lender's interest in the property and allows borrowers to purchase homes with lower down payments.

On the other hand, mortgage insurance can be a more generic term that encompasses several types of insurance policies, including those for government-backed loans like FHA loans. FHA loans require a different kind of mortgage insurance—FHA mortgage insurance premium (MIP)—which varies in its structure and application compared to PMI.

Thus, while both types of insurance serve to mitigate lender risk, they are distinct in terms of how they function, when they are required, and the type of loans they apply to. This distinction underscores why the assertion that they are the same cannot stand.