A lot of divorcees assume that because they have ended a marriage, they would not be able to qualify for loans such as mortgages.
So there’s really no point trying.
It’s as if they have confessed to a crime and sentenced themselves to a lifetime of guilt and self-punishment.
A loss payable clause is a provides insurance coverage to a lender (mortgagee) when property used as security for a loan is destroyed or damaged.
This type of insurance terms can provide protection for both real property and personal property.
For example, if a house that is mortgaged is condemned due to structural problems that was not present when the property was first used as collateral, and the borrower defaults on the home loan, then the bank would be able to claim for losses up to the outstanding balance on the mortgage.
While such a clause effectively allows a bank to charge as much as they want for their loans, banks have to consider various factors before taking any actions that might be deemed as an abuse of their rights.
This is because borrowers can easily switch and refinance their home loan with other lenders if they feel that they are being taken advantage of by their lenders.