How long do I have to carry mortgage insurance? Is there any advantage to keeping it when I’m no longer required to?

When you buy a house in Stamford, CT, you get all the advantages of the location but you also take on a lot of responsibility. After taking into account the mortgage, utilities, repairs, and everything else that comes with owning a house, you are probably looking for ways to save money.

When you purchased your homeowner’s policy through Allkane Insurance, you probably had to get Private Mortgage Insurance (PMI) as a requirement. Usually, anyone who did not put a full 20% down towards the total house payment is required to purchase PMI. The cost of the PMI is usually about .20% to 1.5% of your mortgage, depending on factors like your credit score and loan term.

The mortgage insurance is there so that if you end up not being able to make the payments on your home, the mortgage insurer will pay for a portion of that loss. Unfortunately, the PMI protects your lender but offers no protection to the homeowner.

That means that you may think it is beneficial to cancel the Private Mortgage Insurance as soon as you are allowed to do so. You can check your contract, but most lenders will let you cancel your PMI once you have a certain amount of equity in your home, probably 20 or 25% of the total value. This does not mean that you need to stop having insurance on your home. There are many things that can happen from liability issues to fire and hail. A lot of unpredictable situations can occur. A home insurance policy is beneficial to anyone who wants to hold the value of their home.

If you live in Stamford, CT, you don’t want to miss out on coverage from events that could be easily fixed with the right policy. If you have any questions about homeowners or mortgage insurance, or other general questions about insurance, please feel free to call Allkane Insurance today.