Taking out mortgage insurance
Mortgage insurance is one of the formulas used in recent years because it allows the insured to protect oneself from the risk of defaulting on monthly repayments. Many banks do not consider it mandatory to issue mortgage insurance, however the number of people who take out this kind of insurance policy is on the rise as in the current economic situation it provides peace of mind with regards to the prospect of becoming unemployed or not being able to meet the monthly repayments due to a rise in interest rates.
Precisely for the reasons mentioned above and, in order to avoid non-payment of the monthly mortgage quotas, the financial institutions are offering an insurance policy which normally covers the mortgage payments for six months, although this coverage can be extended.
In many cases mortgage insurance is used as an alternative to the endorsement and the same financial institutions that grant the mortgage offer the insurance, but it is important to know that no one is forced to take out the insurance policy with the entity that grants you the loan.
Apart from the mortgage insurance, the financial institutions require a home insurance policy which, by law, has to cover fire and life insurance