Everyone dreams of having a house of their own and mortgage protection insurance is made to help them with the same. Usually, buyers are supposed to make a down payment of 20 percent of the total loan value and young buyers find it little difficult to pay the same. These insurance plans are made to help buyers initiate the purchase process with fewer down payment and buy their dream home. In this article, we are going to talk about the advantages and disadvantages of mortgage insurance and help interested buyers with the right insight.
• Protection Against Illness
Under these plans, the insured has to make a fixed premium every month and the providers will take care of mortgage premiums during the tough days of their lives. In case the insured falls ill or meets an accident, the insurer provides a certain monthly income to help them take care of the mortgage premium and some essential expenses.
• Unemployment Assistance
Also, when the insured goes off work due to losing the employment or completion of the contract; insurers help them with a guaranteed income to pay for their mortgage payments till they resume their job. These perks prove very beneficial when the insured is going through tough days and help them keep the mortgage going and protect the home for life.
• Peace Of Mind
These plans are known for providing peace of mind to the insured as well as their loved ones. For instance, if you have bought a mortgage payment protection insurance, you can be assured that you won’t have to worry about the mortgage payment during your unemployment days. Also, if the unexpected happens, the insurer will waive off the outstanding loan amount and the loved ones can peacefully live in the same house.
• Life Insurance Benefits
Insurers are providing an option to link their mortgage plan to their life insurance for an additional level of protection. Under this plan, a death benefit is decided for the insured and the same is provided to the beneficiary when the insured passes away. This death benefit greatly helps the loved ones to take care of medical bills, pending debts, and other essential expenses. The insured can also choose the death benefit of their preferences. If they can’t decide a plan by themselves, they can get the help of an insurance adviser to receive mortgage protection insurance quote from different providers. They will ask the specific requirements of the insured and help choose the right plan for them.
Like every other plan, mortgage insurance also has their disadvantages. The biggest advantage is that the insured has to make premium every month and can’t miss the same. In case, they miss the mortgage payment, the lender or insurer has full rights to invalidate their plan and the insured might lose their home. Also, the premium remains the same over the period but plan coverage decrease as the loan decreases.