Schweinsteiger finally left Old Trafford this week, signing a deal with the MLS side Chicago Fire after failing to secure regular first team football under Mourinho.
The 32-year-old has played just four times since the Portuguese manager took over at Old Trafford last year, following on from an injury-plagued debut season under Louis van Gaal.
Mourinho, however, now accepts he was wrong to isolate the popular veteran from his squad and would act differently if he had the chance to make the decision again.
"I do regret it, yeah," Mourinho said on Friday. "What would I do different? I would let him be in the squad.
"I knew in that moment we had too many players. If you remember we had many players in a doubtful situation.
"But after knowing him as a professional and as a person, the way he was behaving and the way he was respecting my decisions as a manager, yes I regret, and it is no problem for me admitting it and he knows that because I told him.
"What I knew about him was a season full of injuries, a season where he almost didn't play, a season where he was having treatment outside of the club, and I thought that was not right, the mentality was not right.
"It was the kind of player who I would not like to have in the club."
Van Gaal paid Bayern £14.4 million ($17.9 million, 16.7 million euros) for Schweinsteiger in 2015 but he rarely showed even glimpses of the form that had made him such a feared midfielder.
The German still retained cult status among United supporters, even though the sum total of his league appearances for the club amount to 13 starts and five substitute appearances over nearly two full campaigns.
However, Mourinho conceded he did not handle the situation well and was unfair in his treatment of the veteran.
As way of an apology, Mourinho allowed him to leave for the United States this week, even though the United manager admits he could have used his services in Manchester over the remaining weeks of a busy season.
"He is in the category of players I feel sorry for something I did to him," said Mourinho.
"I don't want to speak about him as a player I would or would not buy. I want to speak about him as a professional, as a human being.
"It was the last thing I told him before he left -– I was not right with you once, I have to be right to you now.
"So when he was asking me to let him leave, I had to say yes, you can leave because I did it once, I cannot do it twice.
"I could not stop him to go, even though I know we have so many matches and probably would need him for a few matches or a few periods.
"So I feel sorry for the first period with him, he knows that, I am happy that he knows, because I told him.
"I will miss a good guy, a good pro, a very good influence in training. But I had to let him go and now publicly wish him and his wife a very happy life in Chicago."