So, you’re ready to buy a house. You’ve crunched all the numbers, looked at the timeline, and you’re sure this is a sound investment. But you’re still wondering if there’s anything else you can do to increase your chances of getting the loans you need, and paying them off more quickly.
Well, if you haven’t looked into mortgage insurance, this would be the appropriate time.
What is Mortgage Insurance? Do You Need It?
Mortgage insurance is a way of hedging your bets, and looking like a smaller risk when it comes time to get a mortgage loan from a bank. If someone with one of these policies defaults on the mortgage loan, and the title of the property reverts to the lender, then the mortgage insurance company reduces or outright eliminates the risk to the lender. Which is a fancy way of saying that you have an insurance policy that will cover you, if you can’t make your payments and have to walk away from your house.
As a result, borrowers with mortgage insurance are much lower-risk when it comes to lending. This means that borrowers can forego hefty down payments, and they’ll often be given loans with smaller interest specifically because there is an insurance policy backing them up. If the bank has less to be nervous about, then they’ll give a borrower better terms. By contrast, a borrower who doesn’t have mortgage insurance may have to put down as much as 20 percent of the home’s cost as a down payment. That can mean years of saving up, and renting a place to live while you’re saving up, which is wasted time in terms of taking your monthly payments, and turning them into an investment in your future.
If you’re looking to save, there’s no better way to do it.
If you would to like to discuss your options for mortgage insurance please call us at 561-732-9305 our quoting hours are Monday through Friday from 8:30 AM to 5:30 PM. In addition, you can request a quote online. Please remember, We Handle All the Work, While You Save!
Rob Macoviak is the President of Oyer, Macoviak and Associates. Oyer, Macoviak and Associates is the oldest independent insurance agency in Boynton Beach and has been in business since 1953.