Competition among mortgage insurers is paying off. 

Insurers are now increasingly basing mortgage premiums on a new policy called "risk-based" pricing.  This means that your mortgage insurance fees can now be based on your credit score.  No longer will you be slapped with a flat insurance fee if you don’t have the required 20% down payment. 

Here’s an example:  Just weeks ago you would have paid almost 4% of your mortgage in insurance fees if you got a 0% down mortgage.  Now Genworth Financial is offering the same insurance for only 3.1% if you have a credit score over 679.  (Source:  Globe & Mail)

For those with bad credit, it remains to be seen if mortgage insurance premiums will increase to compensate.

Last modified: November 30, 2006