Mortgage Protection Life Insurance
Mortgage life insurance is a form of insurance specifically designed to protect a repayment mortgage. If the policyholder were to die while the mortgage life insurance was in force, the policy would pay out a capital sum that will be just sufficient to repay the outstanding mortgage.
It comes in several forms, but it typically covers your mortgage if you become disabled due to injury or illness, and it pays off your mortgage when you die. Mortgage Protection Life Insurance programs includes critical illness benefits and disability benefits not available in most Life Insurance Plans. This protection helps you make your Mortgage payments while you recover from your illness or injury! Best of all, It is affordable protection you and your family can count on when you may need it most.In
Fact, Many families are forced to leave their family home due to economic hardship caused by disability, illness or death. Are you prepared for the unexpected? Mortgage Protection Life Insurance could be a great solution for you and your family.
Protecting Your Biggest Asset
Your home is usually the single largest asset that you own. However, what would happen to your home if you were to die prematurely? Who will pay off your mortgage for your family if you are not there? How will your family find the funds to make the monthly mortgage payment if you cannot work due to disability?
What’s Covered Under Mortgage Protection Life Insurance?
Helps pay off the mortgage upon death.
Helps pay the mortgage payment upon disability .
Provide a lump sum of cash if diagnosed with a critical illness.
Your family is the beneficiary , not the bank.
10,15, 20, 25,and 30 year term options available.
Return of Premium Rider guarantees 100% Refund of Premiums if you survive the term! Depending on the carrier.
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Mortgage Protection Life Insurance vs Private Mortgage Insurance
What is Private Mortgage Insurance (PMI)
Private Mortgage Insurance (PMI) is an insurance policy that pays off your mortgage when you die. The PMI insurance company will send a check directly to your mortgage company to pay off your mortgage. By law in certain states you’re required to get private mortgage insurance (PMI) if you don’t put down more than 20 percent when you purchase your home. PMI benefit payments are made directly to the mortgage company instead of your family, which benefits the mortgage company more than your family.
Mortgage Protection Life Insurance is most often cheaper compared to purchasing PMI offered by the mortgage companies. There are several benefits for buying term life insurance compared to PMI. You can purchase a large enough term life policy to cover your mortgage, replace your income and provide your family with a tax free cash benefit. You receive a fixed benefit cash payout with a traditional term life policy that you control. You’re better off buying a 20 or 30 year level term life insurance do to the flexible features in most policies today.
Example: If you purchase a 30 year $200,000 term life policy and after 10 ten years you decided to lower the face amount, because you have paid down your loan most companies will allow you to reduce the face amount. You control the policy benefits rather than the PMI mortgage policy that automatically reduces the benefit without lowing the premiums. The term life insurance allows you to name beneficiaries and control the rights of the policy. Your family can decide to use the benefit to pay off the mortgage or continue to make payments. Your family will control the benefits instead of the mortgage company.
Private Mortgage Insurance (PMI)
PMI policies have decreasing benefits, because the payout is generally fixed to the mortgage principal amount. The PMI policy premium remains level for the life of your loan even though the benefit amount is decreasing as you pay down the loan. It’s important fact know that your family will not any control of the money from the PMI policy. PMI is expensive for the amount of coverage and premiums paid. You receive much less coverage with PMI compared to a term life insurance policy. PMI will benefit you if have health conditions that make it impossible to purchase a traditional term life insurance policy.
What is the cost?
The cost of mortgage protection insurance varies from person to person, and as with life insurance, your rate is based on your age and health, as well as the current value of your home, the amount of your regular payment, and the current payoff amount of the mortgage. With policies that make monthly payments in the event of a disability, your cost will vary greatly based upon the industry in which you work.
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