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More Texans Used Private Mortgage Insurance to Become Homeowners in 2024 than Residents of Any Other State
Nearly 70,000 Texan households relied on private mortgage insurance to achieve homeownership with down payments as low as 3% last year

WASHINGTON, DC — More Texans used private mortgage insurance (MI) to purchase their homes than the residents of any other state in 2024, according to a new report released today from U.S. Mortgage Insurers (USMI). Nearly 70,000 Texans used private MI last year, and Texas led the nation for the eighth consecutive year in the number of borrowers who turned to private MI to purchase a home with a low down payment. Last year, 61% of Texas borrowers using private MI were first-time home buyers.

“In 2024, private MI helped homebuyers across Texas enter into homeownership with down payments as low as 3%,” said Seth Appleton, USMI president. “Instead of delaying homeownership waiting for interest rates to fall, housing supply to grow, and home prices to lower, 70,000 Texans chose to put down roots and start building equity sooner with low down payment mortgages backed by private MI.”

Texas Trends
2024 data for Texas showed that:

• It could take a Texas household earning the state median income ($79,060) 22 years to save for a 20% down payment (plus closing costs) for a $349,700 single-family home, the median sales price in Texas. With a 5% down payment, the wait time decreases nearly 64%.
• $376,753 was the average loan amount for a home purchased with private MI in Texas.
• 61% of purchasers in Texas with private MI in 2024 were first-time homebuyers. Nearly 35% had annual incomes below $75,000.
• For many Texans, the biggest hurdle in buying a home is the 20% down payment that many Americans mistakenly believe is required for mortgage approval.

“Private MI serves as a vital bridge to homeownership, enabling qualified borrowers to access affordable conventional financing with down payments as low as 3% while protecting lenders, the GSEs, taxpayers, and investors from mortgage credit risk,” continued Appleton. “Not only is monthly private MI a small, temporary cost, that cost has also declined in recent years thanks to changes in the tax code and the private MI industry’s adoption of risk-based pricing engines.”

Why Use Private Mortgage Insurance?
Private MI helps low down payment borrowers access affordable mortgage financing while protecting the government, taxpayers, lenders, and investors against risk. Private MI enables a borrower to qualify for mortgage financing with a down payment as low as 3%. Borrower paid monthly private MI, the most commonly used form, is only a temporary cost for homebuyers, as it can be canceled once the loan meets certain requirements.

Private MI allows borrowers – who are not able to put down 20% – to qualify for a conventional loan by insuring the lender against potential losses in the event a borrower is unable to repay the loan and there is not sufficient equity in the home to cover the amount owed. Amassing a large down payment can be one of the biggest hurdles to homeownership, particularly for first-time buyers. USMI’s 2024 Homeownership Market Survey found that while homeownership is very important to survey respondents, nearly 6 in 10 (58%) of all adults believe buying a home was more difficult or challenging in 2024 than in prior years. Poll respondents indicated that the main reasons it had gotten harder to buy a home include higher home prices (81%) and higher interest rates (71%). Many say the top challenge they will face when buying a home is an inability to afford a down payment. Meanwhile, only one-third of respondents were aware that it is possible to qualify for financing with only 3% or 5% down.

Recently, President Trump signed the One Big Beautiful Bill Act into law, which contained a provision to reinstate and make permanent the deductibility of MI premiums. This move by Congress and the President means the return of a deduction that provides working class homeowners with meaningful tax relief without increasing risk in the housing finance system. USMI has long advocated for the reinstatement of this deduction, which was claimed more than 44 million times for tax years 2007-2021. Additionally, the 2017 Tax Cuts & Jobs Act included cost savings that were passed on to low down payment homebuyers in the form of lower private MI premiums.

Private Mortgage Insurance Protects Taxpayers
For nearly seven decades, private MI has served as the first layer of private capital protecting the housing finance system from unnecessary risk. It has proven to be a reliable method for protecting Fannie Mae, Freddie Mac, lenders, investors, and taxpayers from losses, having paid $60 billion in claims since the 2008 financial crisis and housing market downturn. That’s $60 billion covered by private capital rather than taxpayers and the federal government. The private MI industry’s ability to employ risk-based pricing to granularly assess, price, and manage long-term mortgage credit risk also allows private MI companies to serve as a second set of eyes when it comes to managing risk in the system, providing further protection to the government-sponsored enterprises (GSEs) and taxpayers.

The complete 2025 report is available here, along with fact sheets for Texas, the other 49 states, and the District of Columbia.

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USMI is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.