What is Mortgage Loan Insurance?
Mortgage Loan Insurance is insurance coverage provided to a lender against default on mortgage installments when the down payment amount is less than 20% of the value of the home. Like any other insurance, mortgage loan insurance requires a premium. The premium amount can vary depending on how much of the purchase price is financed by the mortgage; the greater the down payment, the lesser will be the premium.
Mortgage Loan Insurance is distinct from Mortgage Life Insurance as the latter guarantees that your remaining mortgage at the time of your death will not be a burden to your estate.