Payment Protection Insurance
submitted: Aug 9th 2008 |
by: MosleyShepherd |
Total views: 1 |
Word Count: 632 |
| 
Who pays for mortgage insurance? The lender does, although they will generally pass that cost on to the borrower. Typically, a portion of the mortgage insurance premium is paid up front at closing, and the rest is paid as part of the monthly mortgage payment.long as people are buying homes through FHA loans and paying the mortgage insurance premium there will be people due this refund, so you can do this for many years to come.
Can I pay my own insurance? If you have a VA, FHA or conventional loan with Private Mortgage Insurance, your insurance premium must be collected.FHA MIP (Mortgage Insurance Premium) is a fee collected in connection with an FHA loan. For 30 year loans, the fee is 1.5% upfront, which is added to the mortgage amount. There is also a monthly mortgage insurance premium. For 30 year loans the monthly premium is .50% of the base loan amount (before the upfront MIP is added). This is added to the mortgage payment.A high-ratio mortgage is one where the amount to be borrowed is greater than 75% of the purchase price or appraised value. High-ratio mortgages generally require mortgage loan insurance provided by CMHC, Genworth, and AIG United Guaranty..
Who needs hazard or mortgage insurance? Every mortgage requires hazard insurance, the first years premium is paid at or prior to closing. Borrowers who have a LTV above 80% must pay mortgage insurance.If you have a VA, FHA or conventional loan with Private Mortgage Insurance, your insurance premium must be collected.Mortgage insurance protects the lender against default by the buyer. This enables the lender to make a loan, which the lender considers a higher risk.
Q - What is meant by mortgage insurance premium? A - The mortgage insurance premium or mortgage loan insurance as it is better known is provided by Canada Mortgage and Housing Corporation (CMHC), a crown corporation, and GE Capital Mortgage Insurance Company, an approved private corporation. New players such as AIG United Guarantee Insurance Corporation have just entered the market and as time goes on it is likely that we will see more options.For conventional mortgages, you need a down payment of at least 20% of the purchase price of a home. You can also get a mortgage with a down payment as low as 5%, but you must insure the mortgage against default. The insurance premium would be included in your regular mortgage payment.This is a conventional loan that basically does away with a monthly mortgage insurance premium.
How long is this going to last? long as people are buying homes through FHA loans and paying the mortgage insurance premium there will be people due this refund, so you can do this for many years to come.Ask your real estate agent or lender for information on the HELP program from the FHA. HELP - Homebuyer Education Learning Program - is structured to help people like you begin the homebuying process. It covers such topics as budgeting, finding a home, getting a loan, and home maintenance. In most cases, completion of this program may entitle you to a reduction in the initial FHA mortgage insurance premium from 2.
What is MIP (mortgage insurance premium)? FHA insured mortgages generally require mortgage insurance. Mortgage insurance is a policy that protects lenders against some or most of the losses that result from defaults on home mortgages.If so, it's more that likely you are paying a mortgage insurance premium each month. These premiums can add up to hundreds or even thousands of dollars each year. The worst part is you might not even have to be paying this insurance. If you have paid your mortgage down or if you property has appreciated enough, you could have this insurance premium removed.If so, it's more that likely you are paying a mortgage insurance premium each month.
About the Author
current myths and gives it to you straight
Comments
No comments posted.
You do not have permission to comment. If you log in, you may be able to comment.
