Mortgage vs homeowners insurance: What's the difference? - Business Insider

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You may need both homeowners and mortgage insurance when you buy a house — one of them protects you, while the other covers your lender

Even if you no longer have a mortgage, it is smart to have homeowners insurance to protect your home from wear and tear, natural disasters, theft, and injuries that happen on your property.

For mortgage insurance, you are considered a greater risk to lenders if you have less than 20% for a down payment on aHow long do you pay mortgage and homeowners insurance? Your lender will require you to have homeowners insurance for the duration of your mortgage. However, as mentioned above, even if you no longer have a mortgage, it is smart to have homeowners insurance to protect your home and belongings.

Tarpley noted that lenders are legally required to cancel PMI once you've obtained 22% equity in your home. According to"FHA mortgage insurance [MIP] can't be canceled if you make a down payment of less than 10% [unless] you get rid of FHA mortgage insurance payments by refinancing the mortgage into a non-FHA loan." NerdWallet said that if "you put 10% or more down on an FHA loan, you pay mortgage insurance premiums for 11 years rather than the life of the loan.

 

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