Do I Need Mortgage Protection Life Insurance?
Congratulations, you have qualified for a mortgage and have bought your dream home! Now, you are shopping for a mortgage protection insurance which pays off your mortgage upon your death. During the search for financing, you may have also obtained mortgage life insurance rates from your lender.
What is mortgage life insurance? Life insurance for mortgage protection is frequently sold by banks. Mortgage protection life insurance is like tissue compared to Kleenex, it is a branded name used by banks for life insurance used to cover your mortgage.
However, the branded name and ease of purchase are much more expensive compared to term life insurance purchased in the open marketplace.
Individual term life insurance policies are available with level premiums for 15, 20, or even 30 years. The longer the term length, the more expensive your life insurance premium.
The length of the term also determines how long you will maintain death benefits from your coverage. So, you can buy a 15 year term, 20 year term, or 30 year term to match your mortgage loan's amortization schedule.
To estimate your mortgage life insurance rates be sure to use our Mortgage Life Insurance Calculator.
You can enter the exact amount of term life insurance to cover your mortgage, and the duration required to match typical mortgage duration's of 15, 20, or even 30 years.
Mortgage Life Insurance Calculator
Term Life vs Mortgage Protection Insurance
Term Life Mortgage Protection:
- Lower Premiums: Individual term life insurance premiums are much cheaper then mortgage life insurance rates.
- Level Death Benefit: Your death benefit will remain the same even as you payoff your mortgage.
- Duration: Term life insurance rates can be coordinated with your mortgage duration and can remain the same for 15, 20 or even 30 years.
- Beneficiary Flexibility: You can name your spouse or children as your beneficiary.
Bank Mortgage Life Insurance:
- Higher Premiums Premiums are lumped into your mortgage payment which means you are paying finance charges on the premiums.
- Decreasing Death Benefit:The death benefit will decrease each year, but your mortgage life insurance rates will remain the same.
- Duration: The death benefit will decrease as your mortgage balance gets paid down.
- Beneficiary is the bank The beneficiary of is almost always the bank, or credit union.
As you can see, mortgage protection life insurance sold by banks and credit unions may not always be the best choice to protect your family.
A more flexible and cheaper option for borrowers is to obtain coverage with an individual term life insurance policy or "Term Life Mortgage Protection Life Insurance".
Mortgage Protection Insurance Companies
Just a few the Best Mortgage Protection Insurance Companies:
Mortgage Protection Life Insurance Rates
If you are trying to find inexpensive mortgage life insurance insurance rates, it is very important to work with an agent who is familiar with mortgage protection life insurance.
Our advisers often take many intricate steps to navigate the marketplace on your behalf to find you the most competitive mortgage life insurance quotes. This is how we do it:
First, we ask you a few questions:
- How much coverage is needed to cover you mortgage?
- How long do you have left on your mortgage?
- Do you need term or permanent life insurance?
- Could you get by with a smaller policy? A smaller death benefit is cheaper, and could just make the payments on your mortgage compared to paying the entire balance off.
- How is your overall health? In order to qualify for an individual policy, applicants normally answer a brief health questionnaire and complete a medical exam.
Once we have your goals in mind, we can design a mortgage life insurance policy tailored to your exact needs.
If you are in decent health, the cost benefits of term insurance far outweigh the ease of obtaining mortgage protection life insurance from your bank.
To help determine which option is best for your family, with the assistance of a financial planner, please do not hesitate to call us at 1-877-249-1358.