Mortgage insurance protects the lender. You’ll have to pay for it if you get an FHA mortgage or put down less than 20% on a conventional loan. The traditional target for a home down payment is 20% of the purchase price, but that’s out of reach for many buyers.

Who does mortgage insurance benefit?

Mortgage insurance lowers the risk to the lender of making a loan to you, so you can qualify for a loan that you might not otherwise be able to get. Typically, borrowers making a down payment of less than 20 percent of the purchase price of the home will need to pay for mortgage insurance.

What do you need to know about mortgage protection insurance?

Mortgage protection insurance can ensure that even in the event of your death or disablement, your home can remain a welcoming, nurturing place for your family. Read more to learn if mortgage protection insurance is right for you. Is mortgage protection available for you?

Is there an alternative to mortgage protection insurance?

The most popular – and best – alternative to mortgage protection insurance is a standard term life insurance policy. It’s like a mortgage protection insurance policy in that you pay for the policy for a certain amount of time, but it offers more flexibility than a mortgage protection life insurance does.

Can you get mortgage protection insurance for both spouses?

You may also purchase mortgage protection insurance that provides joint coverage for both you and your spouse. This means the death benefit will be paid when either of you dies. The premium for such joint coverage may be lower than what you’d pay for two individual term life insurance policies.

Who does mortgage insurance protect in the event of a default?

Mortgage insurance protects the lender against loss in the event that the borrower defaults. The borrower pays the premium, but the lender receives the protection.