After signing on to a new mortgage, borrowers may be required to obtain a supplemental insurance policy known as Private Mortgage Insurance, or PMI. Homeowners whose loan-to-value ratio (the amount of your mortgage divided by the value of your home) is greater than 80 percent.

Private Mortgage Insurance premiums are fixed and amount to about one half of one percent of your annual mortgage amount, according to the Mortgage Bankers Association. For example, on a $200,000 mortgage, PMI annual payments would equal $1,000. Premium payments are rolled into your monthly home loan bill.