Two main insurance for a home
Two main insurance for a home. The purchase of a property is a great investment not only for the buyer but also for the one who grants the mortgage loan. In order to mitigate the risks involved in the purchase operation and for it to come to fruition, two types of insurance are implemented, which we tend to confuse.
On the one hand, there is the property insurance or Homeowner Insurance whose objective is to protect the owner’s investment from the damages that the acquired property could suffer in a fire, a theft, a natural disaster, or from third party claims.
Although this policy is not mandatory in Florida, when a property is acquired through a mortgage loan it is a requirement of most financial institutions.
On the other hand, there is the mortgage insurance or Mortgage Insurance (MI) that does not protect the owner, but the lender against an eventual foreclosure of the mortgage. That is if for some reason the buyer cannot continue to pay the mortgage, and the house has to be sold, the lender can recoup a percentage of the money invested. By law, this insurance must be active only until the owner has paid 20% of the property’s value. That is, if someone buys a house with a 20% down payment, they would not be obliged to pay mortgage insurance. Two main insurance for a home.
If you are planning to buy a home, you will need property insurance. Call Univista Insurance and you will get the cheapest insurance on the market.