More often than not, you may have acknowledged a bit or two about mortgage terms when you are planning to get a mortgage loan, for instance the mortgagee clause and other related terms like ISAOA/ATIMA. If you happen to be Nationstar customer, do you have any idea what Nationstar mortgagee clause is?
What is Nationstar Mortgagee Clause?
Many of you have known what mortgage is. But probably not many know this term related to it: mortgagee clause. To find out what Nationstar mortgagee clause is, keep reading.
To be simply put, a mortgagee clause is a provision that will protect the lender in case of home damage occurrence. This provision is included into property insurance policy and will protect the lender from suffering massive losses in their investment. In case of Nationstar mortgagee clause, it means the mortgagee clause is issued by Mr. Cooper Nationstar.
Confused with the definition? To ease you while understanding this matter, we’ll try to give it an example. Since Nationstar mortgagee clause is subjected to the mortgagor, it means the mortgagor have to pay some sum of money as the property’s insurance policy. Then if something bad happens, let’s say the mortgagor can no longer pay the mortgage debt, while the house is in bad condition or probably suffering damage, the insurance company will reimburse for the damage. All of related rules regarding this are written in the mortgagee clause.
This Nationstar Mortgagee Clause, just like other mortgagee clause, usually requires the mortgagors to purchase an insurance policy. The insurance policy can be in the form of the property owner insurance, or the renter insurance. Both insurances will protect property from any physical damage.
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Components of Nationstar Mortgagee Clause
Nationstar mortgagee clause comes with several components. This mortgagee clause encompasses is unknown to most terms, like lender protections, ISAOA, and ATIMA. Below, we’ll try to explain what those three terms refer to.
- Lender protections
Nationstar mortgagee clause comes as a provision that will protect lender’s property. The real act is portrayed in the above example. The insurance company will compensate for the damage occurred in the lender’s property. So, the lender does not need to pay to fix the damage anymore.
ISAOA stands for ‘Its Successors and/or Assigns’. This acronym is also included in mortgagee clause, which means that the mortgagee can sell the mortgagor’s loan on another mortgage market. This is a common act and has no apparent disadvantage on borrowers.
ATIMA is often tagged along with ISAOA, and this acronym stands for ‘As Their Interest May Appear’. This term allows the mortgagee to include other parties to their mortgage business, and setting those parties to be under the same insurance policy without having to name them in an overt way.
If you are soon to be a Nationstar’s mortgagor, it is pivotal to have a good understanding regarding Nationstar mortgagee clause matter. Such provision may have impact on your future real estate transaction and during the process of getting a mortgage. Therefore, you shouldn’t be shy to ask about it if you don’t understand.