Mortgage Insurance
Author: Rob K. Blake | Date: August 18, 2008 | Filed In: Glossary
Mortgage Insurance Defined
Mortgage insurance is an insurance policy that protects the lender in the event the borrower defaults on the mortgage.
Mortgage insurance is not homeowners insurance.
Mortgage insurance will not pay off the mortgage if you die.
It doesn’t offer any protection to you at all. It is protection for the lender but you pay for it.
You can pay a lump sum upfront for the premium or you pay monthly as part of your mortgage payment or both as in an FHA loan.
How much you pay depends on your credit score, loan to value, type of loan etc. A loan above 80% loan to value has mortgage insurance.
You can eliminate mortgage insurance by contacting the lender when you have 20% or more equity.
Author: Rob K. Blake
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