If you have over twenth percent equity, you will not be required to pay for private mortgage insurance. You may finance the closing costs into the loan amount to avoid paying cash to obtain the loan, as long as the total loan amount complies with the lenders equity requirements. Points, also known as discount points, are usually the largest fee that the lender charges. Each point equals one percent ofyour loan amount. If you downpayment or equity is less than twenty percent, you will be required to pay for mortgage insurance.
Mortgage insurance insures the lender against default and foreclosure.
If the borrower default on his or her payments and the property is foreclosed, the mortgage insurance company must repay the lender all or a portion of its losses. Mortgage life insurance is an optional life insurance policy that you can buy from your insurance agent. It pays off your mortgage in the event of your death. Compare the mortgages rates offered by several lenders before you apply for a loan. Mortgage packages vary widely, and it is important to investigate several options to find the one best for you.