Many people actively seeking home ownership have to put their dreams on hold because they haven’t saved up enough money to pay the down payment on a home.
What is a down payment?
A down payment is a portion of your home price that is not financed by the lender. The buyer must pay the down payment for his/her funds or other available sources before securing a mortgage.
When is mortgage loan insurance required?
Typically lenders will require mortgage loan insurance if a borrower has a down payment of less than 20 per cent of the purchase price of a home.
How can Mortgage Insurance help?
– Mortgage Loan Insurance creates an opportunity for more people to realize their dreams of home ownership.
– Borrowers can qualify for larger loans they wouldn’t have been able to attain without the insurance.
– The insurance enables borrowers to purchase homes with a smaller down payment. The down payment can be as little as 5%.
– Clients may become mortgage holders sooner than if they had to wait to save 20% on a down payment.
– Borrowers can enhance the value of their house by using some of their cash for renovations rather than a down payment.
How do you pay it?
Like any other insurance, the Mortgage Loan Insurance has premiums that must be paid. The lender typically passes on the cost of insurance to the borrower. The payment can be paid upfront in a lump sum or blended in installments with your regular mortgage payments.
Sky Financial Corporation offers a mortgage insurance calculator to help clients determine how much they would pay with mortgage insurance. Contact us today to schedule an appointment with one of our financial associates. 1-800-472-9791.