Helping 20 Million Americans a Year for 20 Years. FREE!
Find the Right Lawyer for Your Legal Issue!

Find the Right Lawyer for Your Legal Issue!

Fast, Free, and Confidential

Call us today for a free consultation (855) 466-5776

What is Mortgage Insurance?

UPDATED: October 22, 2013

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident law decisions. Finding trusted and reliable legal advice should be easy. This doesn't influence our content. Our opinions are our own.

Mortgage insurance can allow the homeowner to buy a home sooner with a lower down payment. Not to be confused with mortgage life insurance which pays off the balance of your mortgage when you die, mortgage insurance is required by the lender to protect it against a loan default by the borrower who makes a low down payment less than 20% of the sale price. The borrower pays the premiums, which can be paid monthly or in one large payment. If the borrower defaults, the mortgage insurer pays the lender its money and then seeks to recover from the borrower or forecloses on the property.  

Homeowners Protection Act of 1998

Under the Homeowners Protection Act of 1998, the homeowner can require the lender to cancel the mortgage insurance when the homeowner's loan balance is scheduled to reach 78% of the original value of the home. The homeowner can request the lender to cancel mortgage insurance when the borrower pays down the mortgage to 80% of the home's original value.

Find the Right Lawyer for Your Legal Issue!

Fast, Free, and Confidential

Call us today for a free consultation (855) 466-5776