>>> <timothy.regan@zurich.com> 10/26/98 10:29am >>>
I had noticed the discussion on title insurance and it reminded me of
another type of insurance tied to home purchases that really bothers
me:
Principal & Interest Insurance. I recently bought a new home and
discovered on my payment slips a monthly charge for P&I that is nearly
double the amount for my monthly home owner's insurance! Does anyone
out
there understand this??????? I was told that until I have at least 20%
equity in my home (I only put down 10%) I would have to keep paying for
P&I
Insurance; this, they said, was to protect the mortgage company in
case I
defaulted on my loan. I may not be the sharpest knife in the drawer,
but
if I stop making payments, doesn't the mortgage company get to (1.)
take
the house, which more often than not appreciates in value, and (2.)
keep
all monies that I've already paid?!?! It would seem to me that the
mortgage company is, for the most part, already protected; this isn't,
after all, second chance auto financing where the repossed car isn't
worth
anything!. Then why are the rates SO HIGH? I have discussed this
insurance with other people in our department and they seem to be just
as
mystified about it as I am. I would appreciate anyone's input on this.
Tim Regan
Universal Underwriters
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