All About Mortgage Insurance

Sunday, August 15, 2010

Update August 16 - 2010 All About "Mortgage Insurance" By Insurance Experts

Mortgage insurance is defined as a decreasing term life insurance depending to the amortization of the mortgage period while the premium remains the same over that period. You can purchase the mortgage insurance from the bank, trust or life insurance companies.
1. If you purchase your mortgage insurance from the bank or trust
a) No medical exam is required
b) The beneficiary of the policy is the bank or trust
2. if you purchase your mortgage insurance from the life insurance companies
a) medical exam is required for any sum insured over $100,000
b) The beneficiary of the policy is designated by you ( Kyle J. Norton)

Home Owners Need Home and Mortgage Insurance Coverage
By River C.

Any one who owns a home, and that includes the majority of us who are making monthly payments to a home and mortgage company, must have insurance coverage on their home. If the home is not paid for yet the mortgage company will insist there is at least hazard insurance cover. The cost of the insurance policy is generally included in the monthly mortgage payments. It is considered part of the PITI that constitutes the total payment we must make each month. The initials PITI represent the Principal, Interest, Taxes, and Insurance.

Taxes and insurance come from escrow accounts

Typically the home buyer takes out a "secured loan" when purchasing a home. This means they have the real estate and home as collateral and if the mortgage payments are not met, they can lose the house to the mortgage company. The term mortgage means a mortgage loan which is considered a "secured loan". Along with the principal payments which must be made on the balance of the home each month, there are also taxes and insurance which must be paid, usually yearly. Taxes are generally paid to the county in which the home lies, while insurance payments must go to an insurance company which provides various types and amounts of coverage.

Home and mortgage insurance cover is usually based on how much the home is worth and that amount will usually increase year to year. The mortgage company makes once a year payments to cover both the taxes and the insurance premium and then will add this amount on to the mortgage payments to be made by the homeowner each month. This amount is deducted from an escrow account which is an estimate of taxes and insurance cost for that year. Mortgage companies then determine how much is to be added on to the PI or principal and interest payments to cover the amount owed for the TI or taxes and insurance, prorated over the length of one year. In other words, one twelfth of the total cost of the insurance premium and one twelfth of the taxes will be added on to the monthly payment. This way the home owner does not need to pay the entire tax bill or insurance premium at one time.

Types of insurance coverage vary

Basic home and mortgage insurance cover, generally called hazard insurance, is designed to protect the home buyer from loss if damage occurs to the home. The type and amount of coverage depends on the location of the home, the value of the home, and many other factors. The structure itself as well as personal property inside the home and garage will be evaluated and their worth may increase year by year. Loss of use of the home, which may include added living expenses while repairs are made to the home, is usually included in the basic policy. Fire, flood, earth quake, hurricane, and other disasters may be part of the policy and sometimes involve extra coverage.

Liability coverage should be included in home and mortgage insurance and will provide coverage in case of accidents at the home and in some policies, cover the home owner when away from their home. Visit our website for more information.

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Article Source: http://EzineArticles.com/?expert=River_C.

Thursday, July 29, 2010

Update July 30 - 2010 All About "Mortgage Insurance" By Insurance Experts

Reverse Mortgage Insurance
By John Andrew Jr.

What is reverse mortgage insurance? What are the requirements in order to take advantage of reverse mortgage? First and foremost, the term reverse mortgage must be defined in order to answer both of these questions. To put it briefly, it is a type of mortgage available for old and senior individuals as mandated by the law and the government of the United States. Reverse mortgage insurance on the other hand is a type of insurance that caters to the rights of both the creditor and debtor in a reverse mortgage in case one or either of them is unable to comply with the agreement entered by them through the reverse mortgage contract. This is a remedy that will ensure that the party that is deprived of compensation will still be able to get something of equal or greater value regarding what has been insured through the mortgage agreement.

In order to avail of this reverse mortgage insurance, one must first be able to comply with the requirements of such a mortgage. Firstly, the person availing of this kind of mortgage must be at least 62 years of age. This is a requirement that cannot be waived since the spirit of the law that created this type or mortgage specifically ensured that the individuals who are already of old age have better benefits than younger ones. This coincides with the principle of the older the person gets then the easier and more lenient the requirements to avail of this mortgage become. The debtor or borrower of the money must be exactly 62 years old once the contract of mortgage takes effect as specified in the date contained in it.

Secondly, the debtor or borrower must undergo credit counseling. This credit counseling must be done with a financial specialist or expert through a third party counseling service provider. The objective of this requirement is to ensure that the senior citizen debtor is well informed of what will happen once he or she engages in this reverse type of mortgage. This will equip him or her of the necessary knowledge that will ensure that he or she will not be, in anyway, put into a position that is not favorable. This is a method of the law in itself to protect the rights, privileges and interests of the old individuals of the United States of America.

Thirdly, the debtor must not have any subsisting or pre-existing mortgage in order to avail of this kind of mortgage. This is the protection allotted by the State and the law in order to protect the rights, interests and privileges of the creditor or lender of the money. This will ensure that both the creditor's and debtor's rights have equal protection of the laws that pertain to mortgages and loans. If you want to avail of reverse mortgage insurance then make sure that you first comply with these three requirements in order to prevent any further complications regarding the mortgage itself together with the insurance for such mortgage that you will avail of.

Your base for information about Reverse Mortgages. Let us guide you through the requirements, costs, and all the other details that you need to know. Learn the answers to all of your questions and become more informed in order to get the best deal that you can. Reverse Mortgage Insurance

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Monday, July 12, 2010

Update July 13 - 2010 All About "Mortgage Insurance" By Insurance Experts

The FHA 203(k) Rehabilitation Mortgage Insurance Program - The "Fixer-Upper" Loan

By Jim Hodson

Under Section 203(k) of the National Housing Act, the Federal Housing Administration (FHA) offers mortgage insurance on loans issued by approved FHA lenders to help borrowers purchase and rehabilitate a home. The home should be one that the borrower plans to use as their primary residence. This same insurance program also covers cash-out refinance mortgage loans whose proceeds will be used by the borrower to rehabilitate their current home.

Why the "Fuss" About FHA 203(k) Loans?

Trying to buy a "fixer-upper" home and rehabilitate it can be a very complicated process for borrowers. It typically requires taking out multiple short-term loans with high interest rates. These loans often require a balloon payment when they become due.

The FHA created Section 203(k)-insured loans to address the needs of such borrowers wanting to rehabilitate new or existing homes. This program makes the process of buying and fixing up a new home much simpler by providing the borrower with one long-term mortgage loan that covers everything.

How Do Section 203(k) Loans Work?

There are several basic requirements for a home loan to be covered under Section 203(k). The home must be at least one year old, and the planned rehabilitation must cost a minimum of $5000. The property value of the home must fall within the FHA loan limits for that area of the country. FHA maximum loan limits differ for each county, borough, or county in the state where the property is located..

When a 203(k) loan is closed, some of the money goes to pay for the purchase or refinancing of the home. The remaining money is placed in an escrow account to pay for the work on the home. Funds from the escrow account are paid out as rehabilitation work is completed.

Work Covered By Section 203(k)

Many types of improvements can be covered under this program. They include but are not limited to:

modernization of the home
correcting health or safety hazards
repairing or replacing plumbing
repairing or replacing electrical
repairing or replacing roofing
repairing or replacing floors and floor treatments
landscaping and other work to improve the appearance of the property
energy efficiency improvements

Other types of home improvements are covered. You will want to consult your lender to find out if your particular rehabilitation needs can be covered under the program.

Who Can Apply?

Anyone can apply for an FHA 203(k)-insured mortgage as long as they can afford the monthly house payment based on their debt-to-income (DTI) ratio. To apply simply contact and FHA-approved lender. Many services are available online where you can fill out a single form and get referred to multiple lenders allowing you to compare multiple rates and loan offers.

J Hodson operates FHA-Loan.org, an online resource for borrowers seeking information about FHA loans. There you can find more information on FHA 203(k) loans including the specific FHA maximum loan limits that apply to the particular county, borough, or parish where your property is located.

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Wednesday, June 23, 2010

Update June 23 - 2010 All About "Mortgage Insurance" By Insurance Experts

Considering Long-term Mortgage Insurance

By James P White

Taking out life insurance that includes critical illness cover was the sole method of gaining long-term mortgage protection until recently. There are now options available to provide long-term payment protection as a substitute to short-term payment cover.

The traditional method of gaining long-term mortgage insurance was to include critical illness insurance with mortgage life cover. This form of protection would payout a lump-sum should the policyholder suffer a 'critical illness' condition specified in their policy document. The most common types of illnesses covered include heart attack, stroke and cancer. The payout from the policy could be used to repay the loan in full if the amount of cover was set equal to the amount of debt outstanding at the start of the policy.

In addition to the cover mentioned above, many households would also take out mortgage payment protection to cover monthly loan repayments should the policyholder have to cease working due to short-term accident, sickness or unemployment. One of the greatest issues with these policies is that they will only ever payout for a maximum period of 24 months.

If serious illness insurance is added to mortgage life cover then one would hope that any illness that lasts more than 24 months would be covered, however, there is a risk that the illness is not specified in the policy. New long-term payment protection plans avoid this issue as they can payout until the end of the mortgage loan for nearly any medical condition that prevents the policyholder from working. Thus, this new form of protection provides both an increased length of cover and an increased scope of protection. The main downside is that it can cost considerably more, especially for older individuals.

Article produced by James White of Drewberry Mortgage Insurance, specialist providers of information, advice and broking services in the mortgage protection insurance market.

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Thursday, June 3, 2010

Update June 03 - 2010 All About Mortgage Insurance By Insurance Experts

Disadvantages of Mortgage Life Insurance - Why Term Life is Better

By Denise M

If you are in the market to buy a home or already have a mortgage account, you are probably looking for ways to protect your loved ones from future mortgage debt, in the event of your death. The most common options are mortgage life policy and term insurance.

Term life insurance
A term life policy is an insurance policy that you independently take out with a insurance company, with the idea that a part or all of the proceeds be used to pay off your mortgage. You name a beneficiary, usually your dependants, who are instructed to use the money to settle your mortgage account. Your beneficiaries can retain any left over amounts.

Mortgage life insurance
A mortgage life insurance policy is not offered by a insurance company, but by banks and other financial institutions that have your mortgage. The financial institution is the beneficiary, and the product is designed to have level premiums with decreasing death benefits. Usually mortgage life insurance doesn't require a medical exam.

Disadvantages of mortgage life insurance

Mortgage life insurance coverage decreases with time: The amount of cover decreases in parallel with the amount outstanding on your mortgage. However, your premiums remain level, and you end up paying more for less coverage over the years. Of course, the way it is designed, you don't receive any benefits on it if you outlive the term. The bank retains any left over amount.
A minimum stipulated time period to qualify for a payout: Usually, mortgage insurance doesn't payout in the first six months of the policy. That exposes the mortgagor to a lot of risk.
Excludes pre-existing medical conditions: Though mortgage insurance doesn't require a medical exam to determine premium rates, any pre-existing medical conditions are excluded from the policy.
If you wish to refinance, you need to take out a fresh mortgage policy If you decide to refinance, your existing mortgage life policy ceases, you will have to take out a fresh policy. This can prove to be quite a bit of extra trouble.

Why term life insurance is better

Term life is more affordable: Because the underwriting process in mortgage term life is not as precise as that of a term insurance policy, the premiums can be quite high for mortgage life insurance. Term life is generally more affordable, with its economical premiums.
Death benefits in term life go to the insured's beneficiaries: When you use a term life policy to cover your mortgage dues, your beneficiaries are in total control of the money. If you die many years into your term policy, your mortgage dues would have gone down considerably, which means that your beneficiaries get to retain any leftover cash.
Term offers a choice of policy formats: While mortgage life insurance has a decreasing term format, with term life you can opt for either decreasing term insurance or level term insurance. A decreasing term insurance policy will provide your beneficiaries with only enough money to clear your mortgage. A level term insurance policy on the other hand has a fixed death benefit amount, and therefore can be used to clear off more than just your mortgage amounts. For higher premiums you can also add more protection for other reasons, such as to replace your income, take care of your kids' college fees, etc.
Doesn't require a fresh policy if you decide to change As mentioned earlier, if you decide to refinance, your mortgage life policy ceases. However, with term, even if the underwriting process requires your mortgage documents, the life insurance can't be revoked each time the structure of your finances change.

Make sure you are covered adequately
When you use a term life policy to cover your mortgage, remember that you need to take out additional term insurance to cover your other financial obligations in the event of your death. Look at riders such as critical illness and disability to cover every possibility.

Life is uncertain. With the right mortgage life cover coupled with comprehensive life insurance planning, you can be sure that your loved ones are taken care of when you are no longer around to provide for them.

About AccuQuote:
AccuQuote is a leader in providing term insurance quotes to people across the United States. In 1986 it began operating with a single goal: to make the process of buying term life insurance as easy as possible for its customers. Their experienced professionals consistently deliver the most affordable term life insurance rates by comparing thousands of life insurance policies from dozens of top-rated carriers.

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Monday, May 17, 2010

Update May 17 - 2010 All About Mortgage Insurance By Insurance Experts

Useful Information on Mortgage Insurance Rates

By Ryan Trimble

A lender likes when the buyer puts down at least 20% towards the price of the home. They do not appreciate a high loan to value (LTV) ratio, certainly not one greater than 80%. This means that on a house appraised at $200,000, $40,000 is needed to put down before closing. If this is not possible, either the home cannot be purchased or mortgage insurance (PMI) needs to be purchased.

The purpose of mortgage insurance is to insure the bank or lender against the buyer not paying and perhaps going into foreclosure. The buyer is paying to insure the bank's risk in making the loan to someone who did not put down 20% of the purchase price of the home. If the buyer puts down at least 20%, the purchaser is said to have "skin in the game."

Mortgage insurance rates can run as high as 3%. That would entail a payment of $1,500 for a $200,000 home. In the past the entire PMI was paid at closing. It has since changed and the insurance will run for the length of the loan. This gives the homeowner an incentive to end the payments.

The PMI will be held in escrow. The amount will be added to other escrow items such as home insurance and taxes. when purchasing a home, these added costs must be considered along with the specific monthly mortgage payments.

If the homeowner puts more money into the home each month, the PMI can be stopped, when the equity in the home reaches 20%. If the house appreciates in price and the Loan to Value Ratio has gone down, the mortgage insurance can also be ended.

The buyer will have to take the initiative in ending the mortgage insurance. There is no incentive for the bank to remind you that the insurance can be ended. After all, they are still getting additional insurance that the homeowner is paying for.

Ryan writes numerous articles on obtaining mortgage protection cover and about the facts behind mortgage protection and its importance.

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Monday, April 26, 2010

Update April 26 - 2010 All About "Mortgage Insurance" Information By Insurance Experts

10 Benefits of Mortgage Insurance

By Arjun Rudra

1. Take it with you when you move. If you have a mortgage that's portable, you can transfer its terms to a new property in the future. This same option is available when you buy mortgage insurance, which can save you premiums when you move.

2. Be eligible for a better interest rate. Mortgage insurance provides a lender with the flexibility to offer you the same competitive mortgage interest rates available to home buyers with a larger down payment.

3. More down payment options. Don't let the down payment be the barrier to your home ownership dreams. There are many mortgage insurance products that will help you to achieve home ownership. Let's discuss the options that suit your situation best.

4. Buy, instead of renting. If you're paying rent right now, it can be a good move to consider buying a home that has similar monthly carrying costs. You'll enjoy the freedom of making your living space into your own home with your personal touch.

5. Overcome traditional barriers to financing. More and more homebuyers who may not have qualified for a mortgage are benefiting from mortgage insurance - for example, those who are self-employed or work on commission. With mortgage insurance, people who have good credit but might not meet conventional lending criteria can qualify for the financing they need.

6. Own and enjoy a vacation property. If your financial situation is in good standing and you are thinking about buying a vacation property, there are mortgage insurance options that will allow you to do so. Be sure to ask us about what will work best for you.

7. Get money back on an energy-efficient home. If you purchase an energy efficient home or refinance an existing home to make energy-saving renovations, you could be eligible to receive a 10% refund on your mortgage insurance premium if your mortgage is insured with Genworth Financial Canada.

8. Save on household purchases. When buying your first home, you'll find expenses can add up quickly.

9. Home ownership on your terms. With the right preparation and resources, you can buy a home that best suits your lifestyle. Mortgage insurance provides you with innovative options to help get you into home ownership.

10. Get help when you need it. Whether from a job loss, a serious illness, or a marriage breakup, financial difficulties can arise when you least expect them.

In 2005, Arjun read his first book on investing. For Arjun, that experience sparked a long, extremely exciting and fulfilling journey towards achieving financial freedom at, what some might consider a very young age. While that journey is ongoing and has taken countless hours till date, the elation of finding a truly undervalued stock or discovering a special situation in the capital markets wields a reaction that is probably akin to a prospector discovering a nugget of gold. Arjun founded Investing Thesis to chronicle his journey in the hopes that his successes and failures might work to the benefit of someone else.

All About Mortgage Insurance

Sunday, August 15, 2010

Update August 16 - 2010 All About "Mortgage Insurance" By Insurance Experts

Thursday, July 29, 2010

Update July 30 - 2010 All About "Mortgage Insurance" By Insurance Experts

Monday, July 12, 2010

Update July 13 - 2010 All About "Mortgage Insurance" By Insurance Experts

Wednesday, June 23, 2010

Update June 23 - 2010 All About "Mortgage Insurance" By Insurance Experts

Thursday, June 3, 2010

Update June 03 - 2010 All About Mortgage Insurance By Insurance Experts

Monday, May 17, 2010

Update May 17 - 2010 All About Mortgage Insurance By Insurance Experts

Monday, April 26, 2010

Update April 26 - 2010 All About "Mortgage Insurance" Information By Insurance Experts

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