With companies no longer absorbing the cost or risk of doing business, will lenders now require insurance on all mortgage loans?


Lenders do absorb losses as a risk of doing business. Foreclosed houses are sold at auction for much less than market value, in addition to houses losing value during market downswings. That's why so many banks went under during the most recent debacle. Mortgage insurance covers that potential loss.

1 Answer

  • Maxi
    Lv 7
    1 month ago

    Companies have never absorbed risk of doing business, they charge interest and  only lend a percentage of the worth of the property which they can take if the mortgage is unpaid and sell on to get their money back.

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