How Important Is Mortgage Life Insurance
Mortgage insurance is intended to pay mortgage payments in the event a homeowner is unable to make the monthly mortgage payments. In most cases, people who have had to use the insurance consider mortgage insurance a “peace of mind.” It could mean not losing your house and other financial tribulations.
Mortgage insurance is oftentimes referred to as being covered under a decreasing term insurance, mortgage protection life insurance, or mortgage life insurance. Also, mortgage protection life insurance ensures that your mortgage balance will be repaid if you died during the policy term. Therefore, having mortgage life insurance can be very important to you and your family.
The Benefit Of Mortgage Life Insurance
Simply put, if you die, the balance owed on your mortgage loan is paid off and your family will receive a debt free home. When considering purchasing mortgage life insurance, you should ask yourself if your family could afford to live in your home if your income was no longer available. This question becomes real important when considering this option to a mortgage.
The amount of mortgage life insurance you purchase is equal to the amount of your mortgage. As you make your monthly mortgage payments, the amount of the mortgage life insurance protection decreases as well. This is also known as decreasing term insurance. If the insured dies during the term or this policy, then the mortgage will be paid off.
In short, mortgage life insurance guarantees that the mortgage is taken care of in the event of death. It is often less expensive to purchase and the benefits to your family will outweigh the costs associated with the amount of premiums. The type of mortgage life insurance coverage that you require will depend on what type of mortgage you secure and repayment or interest only plan.