Mortgage Insurance
Different types of insurance explained...
Mortgage insurance is required by the lender if you get a mortgage and your down payment is less than 20%. This insurance is paid for by the buyer or borrower for the lender in the event the buyer or borrower is unable to make the mortgage payments. Mortgage insurance can be paid for in advance or financed as part of the borrower’s monthly mortgage payment. It is best to put down 20% on a home and not have to purchase mortgage insurance but for many consumers that is not possible. The next best thing would be to pay for the mortgage insurance in advance instead of rolling it in to the mortgage and financing the insurance over the life of the loan.