Mortgage insurance

[stillwtr]

What is the name of your state? Florida

If the lender for a mortgage is a bank, is it legal for that bank to refuse mortgage insurance to clients if they are over the age of seventy? The loan was approved without the insurance, but client wishes insurance. Also, what is mortgage life insurance?

 

[ShyCat]

Insurance companies are not required to sell insurance to everyone. They probably don't sell much life insurance to terminal patients in hospices, either. Go figure. It's a business, not a charity. Even a 10 year term life insurance policy for a 70-year-old, if offered by any life insurance company, is prohibitively expensive for good reason. Let's see, a 30 year mortgage and a life expectency of 15 years or less.... nah, bad business deal.

Mortgage life insurance is purchased for the term of the loan to pay for the mortgage balance upon death of the insured. If your mortgage is $100,000 and you die the day after closing, the insurance company pays the $100,000 mortgage. If you die several years later, your mortgage balance will be less and that's what they will pay (for example, your loan payments have reduced the principal balance by $20,000 so the insurance company pays the remaining $80,000). It's a reducing benefit term insurance, rather than a fixed benefit.

 

[HomeGuru]

Writer, in your first question, are you asking about PMI or private mortgage insurance? If so, there can be no discrimination.