Homeowners' insurance: The mortgage connectionA home owners' insurance is the cover for the house against natural calamities as well as liability. This covers the house and its contents but also other personal possessions which the house secures. The natural calamities include fires and winds. It covers thefts and vandalism as well. It is also called hazard insurance (http://www.mortgagefit.com/hazard-insurance.html) It is not mandatory, like in the case of automobile insurance to have a homeowners' insurance. But when one mortgages, the deed of trust or mortgage requires the collateral to be insured. This is because in the event of a default, the lender must not suffer. If in the time span the house gets damaged due to a wind or accident, the value on sale will decrease and thus the lender will not be able to get back the debt balance. Why does the lender insist on a homeowner's insurance? Firstly, the lenders' name or the mortgage company appears on the certificate of the insurance policy. The lender is categorized as a 'loss payee' or a mortgagee. This ensures that the lender is entitled to the insurance amount if the borrower defaults. Secondly, the insurance premiums are paid little by little along with the monthly obligations or it is deposited in with impound or escrow account. In both cases the lender can earn the interest which is earned out of this amount. Moreover an escrow requires an amount much more than a single premium to fund the account. The manner of payment of the insurance premiums differs from lender to lender. Some require that the insurance premiums be paid off in the first year after closing; while others will spread the same throughout the loan term. What you should keep in mind before taking a homeowners' insurance? You should shop for an insurance agent extensively .You must go in for an insurance company which will make an honest evaluation of your home value. This insurance is not only for a liability security it is important to the borrower as well especially if you aim for a refinance or a remortgage. The collateral remains the same .Thus you can still avail of a loan amount equal to the earlier mortgage amount if not more (due to appreciation). For a detailed study of mortgage and such other terms you can log onto: http://www.mortgagefit.com
MORE RESOURCES updated Wed. May / 08 / 2024 Mortgage Interest Rates Today, May 8, 2024 | Average Rates Ease After Spiking Above 7% Business Insider Mortgage Interest Rates Today, May 7, 2024 | Rates Ease Thanks to Cooling Job Market Business Insider Best mortgage lenders for refinancing in May 2024 CNN Underscored Mortgage Credit Availability Increased in April | MBA Mortgage Bankers Association MBA: Mortgage Applications Increased in Weekly Survey Calculated Risk Redfin’s $9.25 Million Agreement Ends Legal Battle Over Inflated Commissions – Forbes Advisor Forbes 15-year refinance rates: Pros, cons and current lenders offers CNN Underscored Average Mortgage Interest Rates: Mortgage Rates by Credit Score, Year, and Loan Type Business Insider What Credit Score Do You Need To Refinance? Bankrate.com Mortgage Interest Rates Today, May 6, 2024 | Rates Are Still High, but You Could Save by Shopping Around Business Insider Best Mortgage Refinance Lenders of May 2024 Business Insider How to Refinance Your Mortgage NerdWallet Mortgage Refinance Rates: Compare Current Rates Business Insider Should You Refinance Halfway Through Your Mortgage? Bankrate.com Types of Mortgage Refinance Options Bankrate.com 30-Year Mortgage Refinance Rates Business Insider 10-year refinance rates: What to know CNN Underscored Will Mortgage Rates Go Down in 2024? What Homebuyers Should Expect Business Insider How To Get The Best Refinance Rate Bankrate.com Loan Modification Vs. Refinance Bankrate.com Should You Refinance Your Mortgage In 2024? Bankrate.com Better.com Mortgage Review 2024 | US News U.S News & World Report Money 15-Year Mortgage Refinance Rates: Compare Current Rates Business Insider Current mortgage refinance rates CNN Underscored Best Mortgage Refinance Lenders In 2024 Bankrate.com VA Refinance Rates - Current VA Loan Refinance Rates Today Business Insider Best Refinance Lenders of May 2024: Refinance Your Mortgage The Motley Fool Mortgage Interest Rates Today, May 2, 2024 | Rates Unlikely to Drop Until the Fed Starts Cutting Business Insider Current FHA Refinance Rates Today - Mortgages Business Insider When to Consider Refinancing Your Mortgage Business Insider 30-year refinance rates: What to know CNN Underscored Refinance Requirements: What You Need to Refinance Your Home in 2024 The Mortgage Reports How To Refinance An Underwater Mortgage Bankrate.com Conventional Refinance Rates and Guidelines for 2024 The Mortgage Reports 317,000 Former Art Institutes Students See $6 Billion in Student Loan Debt Canceled – Forbes Advisor Forbes How Soon Can You Refinance a Mortgage? NerdWallet Mortgage Interest Rates Today, May 1, 2024 | Rates Hold Steady at 7% Business Insider The best auto refinance rates in May 2024 CNN Underscored When to Refinance Mortgage: Is it Time? - Buy Side from WSJ The Wall Street Journal Should I Refinance My Mortgage Now? When to Refinance As Rates Drop Business Insider Pros and Cons of a Cash-Out Refinance Bankrate.com
|