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Mortgage Insurance

Anyone who took a mortgage knows that a prerequisite is the availability of its receipt of the insurance policy. Loans organization requires guarantees repayment of the loan if the borrower would be insolvent. In this context, mortgage insurance is very important, because insurance contract is for the entire term of the mortgage lending.

Mortgage Insurance and Its Types

As practice shows, banks are unanimous in their demands Applicants mortgages and require them to insure the following types of risks: the title, life and health, and housing itself. Consider the types of mortgage insurance details.

Title insurance is necessary because the theory is always a probability of loss of ownership of the borrower house bought on a mortgage. And if an insured event occurs (for example, by virtue of a court decision), the bank in any case receive their money if the borrower is an appropriate insurance policy. This is important mortgage insurance because it protects the loans of the claims of third parties on the subject of mortgage. Rates for title insurance can vary depending on the insurance company and the average 0.2% -0.7.

Mortgage life insurance and health of the borrower to the bank guarantees refund of mortgage loans if the borrower is seriously ill, injured, become disabled and will therefore insolvent.

Mortgage life and health insurance provides compensation to the bank of its costs in the case of death of the borrower, its total or partial disability. Contract of life insurance and health at the initial stage involves filling out a questionnaire and physical examination of the borrower. Strongly recommended for all stages of mortgage insurance to report false information about itself, trying to mislead the insurance company. Where fraud is discovered - insurance on favorable terms cannot be obtained, and a loan will probably be denied.

Depending on the age of the borrower and his health insurance rates are determined by its life and health. Tariff size may vary depending on the insurance company (on average, 0.3-1.5%). If the applicant loan attracts co-borrowers - mortgage insurance fully applies to them, the bank will require this for sure.

Home insurance, as an integral part of the mortgage insurance is also quite reasonable requirement of the lending bank. Borrower to insure within its full value, is more attractive for the bank client, because with the loss of the apartment insurance company will reimburse the bank issued a mortgage loan. Rate mortgage home insurance may also vary depending on the quality of housing, its parameters and the specific insurance company, and an average of 0.3 - 0.5% of the contract. Insured event deemed to have occurred if the accommodation is lost and damaged due to fire, natural disaster, flood, explosion, acts of third parties. If the contract of mortgage insurance housing was concluded before in a brand new building design defects were discovered, - the insurance company in this case would be responsible for reimbursement of its costs to the bank.

Mortgage insurance - an important point in obtaining a loan to purchase property, as well as throughout the period of payment. However, before you put your signature on the insurance contract, the borrower should be most careful to read it - in particular, the section detailing indicates which events are considered insurable event and lead to insurance benefits. Housing mortgage insurance may provide force majeure, which are not considered insurable event. These include the loss of real estate due to hostilities, confiscation, malice or negligence, destruction by the authorities, etc.

Mortgage insurance. Fuel borrower

Terms, on which mortgage insurance contracts are concluded, depends on what kind of homes sold in the primary or secondary market. In the first case, the apartment is secured with the receipt of the borrower in the property in the second - from the moment of obtaining a mortgage. Life and health insurance borrower held immediately before obtaining a bank loan.

Payments under the mortgage insurance provided every year and decrease proportionally reduce indebtedness of the borrower to the lending institution. The total cost of mortgage insurance can range from 1.5% per year from the balance amount with interest.

If the insured event occurs - the borrower must immediately notify the insurance company and the creditor bank. If death occurred borrower or his loss of ability to work, - the obligation to repay the loan transferred to the company's insurer. In this case, mortgage insurance protects the interests of the citizen, - housing, acquired a mortgage, remains the property of the borrower or his heirs.

Mortgage Insurance, Pada: 9:40 AM


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