Conference nyoss1::market_investing

    
    	Re: .0
    
    	My understanding of PMI is that it only pays under cases of
    foreclosure.  (I'm using "PMI" here to mean that insurance that a lot
    of folks get stuck with if they are putting down under 20% when they
    finance a property.)
    
    	Now there are companies that offer separate mortgage insurance to
    pay off your balance in cases of death or long-term disability.  (I
    think in the cases of long-term disability they might only pay the
    regular monthly payments for the duration of the disability.)  I
    wouldn't recommend these due to the cost versus the amount of effective
    coverage you get back, but if you did have one of these policies then
    you could reasonably factor that money into deciding how much regular
    life insurance you need.
    
    							-craig

    I believe PMI covers you to the extent that if your spouse dies then the
    mortgage would be paid in full. I dont know to what extent one must go
    through if this should happen though other then the regular red tape on
    filing forms.
    
    I for one have PMI w/my mortgage but if I can cansel it I am going to.
    
    Here is why, I am still young and the likelyhood of me dieng is rare
    unless I were to get run over by a car, truck or something of that
    nature. As the years go on though I would reconsider adding it back on
    to the policy because at a certain age bracket now you're talking
    about your age being a big factor in possibly passing away before your
    time is up and the price of the policy would be well spent to have a paid
    up mortgage for your spouse or yourself if your partner should pass away.
    
    Doe this make any sense or what?
    
    Frank 

    I too thought that PMI was meant to protect the BANK in case you
    defaulted on your mortgage. Usually when you take out a mortgage, the
    bank REQUIRES that if you put down less than 15 or 20% (depending on
    the bank) you must pay $X for PMI which is added to your regular
    mortgage payment. You are also asked whether you would like to purchase
    (optional) MORTGAGE LIFE INSURANCE which pays the balance of the
    mortgage if you should die before the mortgage is paid off (The cost of
    this insurance is added to your mortgage payment and is  based on the 
    amount borrowed, your age, the length of the mortgage obligation, and
    whether it covers one person or both you and your wife etc.) MORTGAGE
    LIFE is essentially a "decreasing term life insuarance policy" which means
    that the amount of the insurance decreases every time you make a
    mortgage payment because the balance you owe on the mortgage decreses
    with every payment (credit life insurance operates on the same
    principal). I'm not positive about this so correct me if I'm wrong but
    I believe that this type of insurance will only pay in case of DEATH
    and doesn't cover DISABILITY (which is much more likely if you are
    young). At any rate, PMI protects the BANK if you default (the bank
    still owns your house though), MORTGAGE LIFE protects your wife if you
    die (the bank gets paid, your wife gets the house).
    
    If you have a regular life insurance policy for an amount that would 
    provide your family with enough money to enable them to live without your 
    income if you died prematurely, combined with an adequate amount of 
    disability insurance, in case you become disabled, then you do not need to 
    pay extra for any of these other types of life insurance that you will
    spend a whole lot of money on and most likely get nothing in return
    (hopefully). At any rate the more you pay in, the less the insuarance is
    worth. (Insurance companies, banks etc make a bundle on these types of 
    policies which explains why they push them so hard (my 15 yr mortgage
    is 6 years old and I'm still getting offers to buy a policy)... don't
    bite).                                      
    

    a second vote - PMI is definitely insurance for the bank and not the
    home owner. The homeowner has NO say in whether to drop PMI or to keep
    it. The bank will require it if the house doesn't have a certain equity
    (most banks require 20% equity). PMI is to protect the bank so that if
    something happens (heaven forbid), the bank at least should be able to
    cover the mortgage by selling the house and even if the amount comes
    short of the mortgage, PMI covers 20%.
    
    Warning - this is only my opinion of PMI.
    		Cindy                       

    re .4, my reply should have read "a second reply".
    	Cindy
    

    PMI is as stated in previous replies.  It is insurance for the bank. 
    If you want Mortgage life insurance (insurance that pays off the
    balance due on the mortgate should you die) you can contact the
    mortgage company, they will be very happy to sell you such a policy. 
    However, these policies are very limited in scope (fine print) and are
    more costly than basic term life insurance.  My opinion is that you go
    our and sign up for term life (or whole life) insurance policy that is
    equal to or greater than your current mortgage.  This way should you
    die, your next of kin will have the money to buy the house outright, or
    better yet invest the money and continue to pay the mortgage and
    receive the tax write-offs.