Mortgage Insurance

When mortgage insurance Housing Bank insists on the insurance in the amount of credit, increased by 10%, but many borrowers insure acquired housing at its full value. In this case, if it is an insurance case, the insurance company pay mortgage in the bank for the borrower, and will give the remaining amount to the borrower on the insurance contract.

If the borrower (or his employer) Insurance Company insured earlier life and work in any insurance company, and he does not want to change the insurer of these risks, he must pick a bank, which is ready to set off from the existing borrower’s insurance policy , despite the fact that the insurer is not his partner.

Regarding the loss of property rights to housing, some banks require to insure the risk for the whole period of mortgage lending, and some only 3 years (limitation period for invalid transactions). If housing in the newly acquired, the title insurance optional.

Tariffs on insurance risks are determined individually for each borrower. Shelter Insurance 0,3-0,5% of the amount of insurance and depends on which homes have overlapping (wooden or otherwise), general technical condition of housing, availability of finishing, etc. The tariff for life insurance and disability mortgage borrower changes in the 0,3-1,5%. It affects the borrower’s age, his health, the nature of professional activity. Sometimes banks are required to insure the same sozaemschika life if its income is taken into consideration when determining the amount of credit. When title insurance has the meaning «purity law» housing. Rates on the risk of 0,2-0,7%

The average total cost to the borrower’s mortgage insurance constitute 1-1,5% a year from the balance on the loan, taking into account percent.

Insurance payments on mortgage carried out once a year. When a suitable period of payment, the bank reported to the insurance company debt balance of the borrower, and, based on that amount, calculated as the premium. Thus, the size insurance payments each year, along with reduced debt on the loan. Life insurance and disability pay after receiving the loan. Moment of insurance payments on a housing depends on the housing purchased — ready or under construction. In the first case, the borrower pays the insurance and real estate title after receiving the loan, while the second — after the issue of housing in the property.

When entering into a contract mortgage insurance should carefully examine the list of insurance cases on which the losses would be reimbursed. When life insurance and disability insurance cases are usually insured death and partial or complete loss of benefits (the attribution of a disabled group I or II) during the period of insurance contract. When insurance housing insurance event is the loss of or damage to property by fire, the Gulf of liquid natural disaster, unlawful acts of third parties (vandalism, arson, explosion explosives), building design defects, which at the time of conclusion of the contract, the insured was not aware. Insurance cases title insurance housing may be entered into legal force the court decision, in which the borrower has lost ownership rights to  mortgage .

When the insured event should be immediately notified to the creditor and the insurance company and clarify procedures to be followed in any given situation.

In the event the borrower’s death or disability of obtaining them insurance company for him to perform obligations to pay mortgage and payment of interest. Laid flat becomes the property of the borrower or his heirs.

In case of damage to insured housing, insurer borrower pays the insurance reimbursement. If housing was insured only for the amount mortgage , rather than the full value it received on the insurance funds might not be enough to rebuild housing.

In the case of physical loss or loss of home ownership to him, the recipient insurance payments is a bank lender, and he will receive from the insurance company debt under the loan balance, increased by 10%. The borrower can get the difference cost of housing and mortgage , if the insured housing at its full value.

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