P&I Insurance

( timothy.regan@zurich.com )
Mon, 26 Oct 1998 09:29:35 -0600

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 o=
ut
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 cas=
e 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.) tak=
e
the house, which more often than not appreciates in value, and (2.) ke=
ep
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 wo=
rth
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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