Final answer:
The insurance benefit from homeowner's insurance will be used to repay the loan if the house burns down, covering damage or burglary and satisfying mortgage requirements.
Step-by-step explanation:
If the house burns down, the check from the insurance benefit from paying the homeowner's insurance will be used to repay the loan. When a dwelling is damaged or burglarized, homeowner's insurance typically pays out to cover the losses. In the case of a total loss, such as a house burning down, the insurance company would provide a check to the policyholder, which can then be used to settle the mortgage on the property. It's important to have this insurance not only to protect your asset but also to meet mortgage requirements, as lenders typically require proof of insurance before approving a loan.