Mortgage Insurance Plans: How Good Is Yours?Written by Ivon T. Hughes
Mortgage insurance, to pay off a mortgage, is something you'll inevitably be asked to take out by bank. Mortgage insurance is necessary so that if something happens to you or your spouse then your loan will be paid off which is good news for your family and bank. Banks act as if doing you a favour by offering mortgage insurance through their own group plan. Are they?Mortgage Insurance Is Probably A Much Better Deal From Any Number Of Insurance Companies. Mortgage insurance is no different than term life insurance; in fact it is term life insurance. With either, your policy lasts for a specified period of time and pays if something happens to you or your spouse if you are both insured. The real difference is how much control you'll have over your policy and how much you'll pay for it. Mortgage insurance offered by bank, does not allow you to customize a policy to fit your needs and you'll be lumped together with other borrowers under a group plan. So, you will have no control over your policy. For example, through a company of your choice, such as Canada Life or National Life, you would be able to choose your own beneficiary and decide how to spend proceeds. These options are not available with a mortgage taken from a lending institution. If insured party dies, mortgage loan is completely paid off, even if you need some money for other things. Additionally, bank has right to not renew your policy and to cancel policy when you sell house. Do you want to give up this control as now you may have become uninsurable?
| | Are you paying too much for your mortgage insurance?Written by Ivon T. Hughes
Most of us, struggling to make our mortgage payments, realize importance of financially securing our home and our lifestyle by putting in place some life insurance. Your bank or lending institution does too! They will usually require that loan amount be covered by life insurance to protect them in unfortunate situation of you dying before loan is paid.The problem is that most of us are so excited about buying our new home, we quickly checkmark box to indicate that we want mortgage life insurance without checking market to see if you are paying too much. For smokers or unhealthy individuals, this type of creditor insurance can be an excellent value. For vast majority of us, healthy, non-smokers, will likely get a better rate by shopping market.
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