Mortgage Insurance
'''Insurance''', in law and economics, is a form of risk management primarily used to hedge against the risk of potential financial loss. Ideally, insurance is defined as the equitable transfer of the risk of a potential loss, from one entity to another, in exchange for a reasonable fee. In practice, however, the business of providing insurance protection often ends up in litigation between the parties involved, while the responsibilities of regulating insurance markets routinely winds up as a political football for government agencies.
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Last Updated August 11, 2005
Mortgage Insurance: A policy that guarantees repayment to a lender of a mortgage loan in the event of default. See "insured mortgage;" "FHA;" "VA;" "FmHA;" "private mortgage insurance."
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Insurance for the lender in the event that the borrower defaults on the loan. The cost for mortgage insurance is usually built into the monthly payment made to the lender, and is typically required when the loan has an LTV of 80% or greater (when the down payment is less than 20% of the home's value). This can also be called private mortgage insurance for conventional loans, because a private institution rather than the federal government backs them.
www.realestate-resources.com/loans-ebooks/loan-definitions.html
Insurance required for loans with a loan above 80.01%.
www.pmel.org/RealEstate-Mortgage-Glossary.htm
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