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What is Mortgage Insurance

January 31, 2017

Mortgage insurance is mandatory insurance required on some types of home loans that exceed 80% of the value of the home.

 

Mortgage insurance enables home buyers to put very little money down rather than 20% down when purchasing or refinancing. The mortgage insurance is paid to the lender along with the monthly mortgage payments. It allows the lender to give home buyers more money toward their purchase because the mortgage insurance helps lenders reduce their risk. Insurance protects lenders against losses if borrowers are unable to repay a loan. They are less likely to lose money on foreclosed properties, giving the lender more flexibility when lending larger amounts.

 

What does this mean to the home buyer, or person looking to refinance? It means that years of scrimping and saving to purchase a home are possibly in the past. With as little as 3.5% down for FHA loans, and as little as 0% down in some cases for USDA loans, more and more people are finding this is the perfect time to stop paying the landlord and invest in their own future.

 

Contact us today at GSF Mortgage to talk about building your net worth with a home purchase!

 

 

Ron Meyer
GSF Mortgage Corporation
300 Patriot Dr.
Little Chute, WI 54140
(920) 788-9608
rmeyer@gogsf.com
NMLS #222688 & 1018