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What is mortgage insurance

By bazurto2967 from AZ Jul 25th 2014

Mortgage insurance is an insurance policy that is taken out when you obtain a conventional mortgage but you put less than 20% down, or you take out an FHA mortgage.. you pay the premium which is usually broken up and added to your monthly payments.. and although you pay for the insurance, the lender is actually the beneficiary. The policy is supposed to reimburse the lender any losses they accrue as a result of a defaulted loan, less their deductible. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com

Jul 25th 2014

Mortgage insurance(MI)is required for loans with less than 20% down. it is provided by private mortgage insurance companies to protect the lender in the event the Borrower defaults on the loan. On Conventional financing, the MI typically will automatically drop of at 78% of the original purchase price. If Equity in the property is realized prior to reaching the 78% of the original purchase price (due to appreciation/increase in the market value of the home), then you can either petition the lender to remove the MI (with documentation of value and additional requirements may apply), and there may or may not be a penalty or minimum MI required payment period (i.e. 5 years). On FHA, MI is now lifetime of the loan, so you will have to refinance out of the FHA loan once 20% equity is acheived in order to remove the MI. Give me a call if you have any additional quesiotns. We can lend anywhere in the state of AZ. Russ IdeishiAVP, Mortgage BankerMohave State Bank928-302-5152 (direct)928-230-6065 (cell)NMLS# 451309

Jul 25th 2014

Mortgage insurance is required on loans that have a loan-to-value ratio greater than 80%. Lenders need to protect themselves in the case that a borrower defaults and generally do so by using the home as collateral. However, when the borrower does not have much equity, the lender doesn't have much to take if they stop making their mortgage payments. The mortgage insurance will help make up for the loss the lender takes when a borrower defaults on a loan.

Jul 25th 2014

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