Get back to the business of cutting government spending and anti-investment tax provisions, such as capital gains. There is no more depressing example of the GOP's ideological drift than this. Now they propose new ones, and justify their actions by resorting to Naderite rhetoric about price-gouging and consumer protection. The underlying premise here is that mortgage insurance is simply a frivolous extra cost of a home loan. The truth is that without private mortgage insurance protection some 20 million homeowners over the past 40 years may not have been able to obtain the financing to purchase their houses in the first place.
Mortgage insurance protects the lender against default on low down payment mortgages.
The homebuyer pays a premium to the PMI for this protection. There's no law that requires a prospective buyer to purchase mortgage insurance. And this is a highly competitive industry. At this point the risk of default is extremely low. In the first place, the vast majority of homeowners stop paying mortgage insurance at this point.