One of the main criteria for making a mortgage loan is insurance. The insurance process provides for protection of both individual borrowers and the bank as a whole. But most of all banks are interested in the insurance of borrowers. Because with the loss of solvency of the borrower, the bank will incur damages. But in the case of the availability of insurance at the borrower, the income of the bank will be returned.
In this regard, often banks denied mortgage lending to persons who have no insurance.
First, if suddenly the borrower loses its working capacity or the death of the borrower arises, thanks to insurance, heirs will not need to pay this loan.
Secondly, when the appearance of third parties, who claim to hold real estate, you will not lose money.
In modern times, there are several types of insurance in the mortgage, consider each in more detail.
When you make a mortgage, for the bank you need to insure only mortgage property. All other types of insurance are drawn up at your discretion.
Also, it is worth noting that each bank has its own insurance conditions for mortgage loan, and, as a rule, banks insist on the design of all types of insurance. It is not so easy to refuse them, since sanctions are prescribed in the contract if you want to abandon the insurance.
Insurance on mortgage is bought separately at the insurance company, it is not included in the cost of the loan. You can choose the company yourself, and the bank can only offer you insurance companies with which they cooperate.
You can, if you adhere to insurance councils.
Real estate insurance is a mandatory measure when issuing a mortgage loan!
Avoiding mortgage insurance still fails, as one of the types of insurance is a mandatory measure. Thus, the bank takes care of its safety, and the amount of insurance is small. Insurance usually pay once a year and constitutes 1% of the remaining debt.
Banks use a special algorithm when calculating insurance, where age and amount are taken into account, that is, what you are older, the amount of insurance is more.
Tell us what insurance for mortgage loans you have, and how much do you pay for them per year? I would like to know the opinion of people on this account.