Example: If your unpaid principal balance (UPB) is $80,000 but the replacement cost is $120,000, you need to carry a minimum insurance of $80,000 total. Note: There may be exceptions to this for properties in certain states. Your insurance carrier can tell you more about this.

Depending on the type of insurance, you will need enough to cover the lower of either the replacement cost of the property or the remaining principal balance on your loan.

Title Insurance Under owner’s coverage, the title to your home is insured if disputes or claims arise after closing.

Learn how much insurance you need to cover your home and loan, and which types of insurance are required or optional for your property. Find out how to pay for insurance through your escrow account and what to do if you live in a high-risk area.

Mortgage insurance protects the investor or noteholder if the borrower defaults on the loan. It lowers the investor’s risk when funding a home loan. In most cases, if you pay at least 20% down on your home, you’re not required to carry mortgage insurance.

When a disaster strikes your home, your insurance company may issue an insurance claim check, which can also be called loss draft funds. A claim check is meant to cover various costs, including repairs.

Learn how much insurance you need to cover your home and loan, and which types of insurance are required or optional for your property. Find out how to pay for insurance through your escrow account and what to do if you live in a high-risk area.

If you opened an escrow account as part of your loan agreement—or chose to open one to simplify your life—we will take care of your tax and insurance payments for you.

We’ll send you a projection of future escrow disbursements—which includes your new monthly payment amount—and an agreement that you must sign and return by the date listed in the cover letter. You must physically sign the agreement (no digital signatures) but you can send it back via...

An escrow—or impound—account is where funds are held to pay property tax and insurance bills on your behalf. If your loan is escrowed, a part of your mortgage payment goes into your escrow account every month.