Mortgage Insurance

Giving rather large amount as credit any financial organization wants to minimize risks because the credit is granted most often against security of the real estate which in fact is its provision. Therefore, the main risk for banks which grant the credit is reduction or total loss of project cost of crediting.

First of all, there is a registration of compulsory property insurance.

The second serious risk is a solvency of the borrower who can be traumatized and lose an opportunity to earn, be dismissed or even die. The credit company naturally wants not to appear somehow in minus. Therefore, life and health insurance of the borrower is added.

The third risk is especially vital at purchase of real estate in the secondary market. When not only the borrower but also none of certified agency on real estate can guarantee the absence of the third parties who can unexpectedly appear and apply for the property right on the bought real estate object. For minimization of such risks there is title insurance.

And at last the type of insurance which essentially distinguishes a mortgage loan from any other is an insurance of valuable interest of the creditor which is connected with non-execution of agreement obligations by the borrower.

In all above specified listed types of insurance the creditor bank acts as the receiver on the insurance.

Such quantity of insurance policies in case of mortgage loan is directed not only on reduction of risks of creditor bank but also on mitigation of credit conditions for the borrower.

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