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Mortgage Insurance for Littleton Colorado Homes
Mortgage Insurance for Littleton Colorado Homes
Makes Low Down Payment Loans Possible!
Simply put, mortgage insurance protects the mortgage company against financial loss if a homeowner stops making mortgage payments. Mortgage companies usually require mortgage insurance on low down payment loans for protection in the event that the homeowner fails to make his or her payments. When a homeowner fails to make the mortgage payments, a default occurs and the home goes into foreclosure. The homeowner, lender and the mortgage insurer lose in a foreclosure situation. The homeowner loses the house and all of the money put into it. The mortgage insurer will then have to pay a percentage of the mortgage company's loss on the defaulted loan.
The mortgage company's decision to use mortgage insurance is driven by the requirements of investors in the mortgage market. Because of the losses that could occur, major investors require mortgage insurance on all loans made with low down payments. Although the cost of the mortgage insurance is paid by the borrower, the mortgage insurer works directly with the mortgage company.
Low down payment mortgages can be insured in two ways -- through the government or through the private sector. Mortgages backed by the government are ... more

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