Home Mortgage Insurance

Home mortgage insurance helps protect lenders and mortgage investors from severe financial losses in case a loan is not repaid for any reason. This insurance has benefits for lenders and investors and it helps homebuyers too. Because lenders are protected by mortgage insurance, they are willing to offer loans at a very low down payment - as little as three to five percent of the loan amount or, in some cases, with no money down.

Every one has a dream of owning their own homes, but only few are able to pay cash for them. Many individuals and families who cannot afford to own home 123-mortgage-company’s insurance programs make it possible for them to be homeowners. To apply for mortgage insurance, you should work with a HUD-approved lender such as bank, a mortgage company, or a credit union whether you are buying a home, making improvements, or refinance your current mortgage. Once your loan is approved, FHA will insure the loan and pay the lender if you default on mortgage. Because by this insurance the lender protects you, the lender on your loan give you better terms.

Lower down payment lenders require you to pay 10 percent or more of the cost of a home in cash as a down payment. With FHA- mortgages insurer your down payment can reduce to 3 percent. For that, lender requires you to prove that you have enough money for the loan down payment.

With FHA mortgage insurance, you can use gift from your relatives or other local organization, or a government agency for the down payment and closing costs under certain circumstances.