Question by Misty: What’s the difference between Mortgage Insurance/Hazard Insurance & Homeowner’s Insurance?
In my housing loan application it gives the breakdown of the principal mortgage payment, taxes, hazard insurance and mortgage insurance. What is the mortgage insurance? It’s an additional $ 70 per month.
Best answer:
Answer by mbrcatz
Mortgage insurance, is PMI – if you put down less than 20%, YOU pay for the insurance that covers the bank, if you default on the loan. You pay this, until you have 20% equity in your house.
Hazard insurance is mortgage talk, for insurance that covers your house if something happens to it. Homeowners insurance, is insurance talk, for the cheapest kind of policy, that covers your house if something happens to it.
So. Mortgage insurance is PMI, and hazard and homeowners insurance are sort of the same thing.
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Mortgage insurance is the insurance premium you are paying because you are putting less than 20% down.
Without this you could not buy a home until you had 20% downpayment.