It is no secret that your home is likely the largest and most expensive purchase you will make in your entire life. Of course you will also spend the better part of your life paying for it as well and that means that you will want to protect the investment that you have made. This is where mortgage life insurance comes into play. There is no better way to ensure that your family will have a place to live should you come to an untimely end.
Mortgage life insurance is exactly what it sounds like, life insurance that is specifically for paying off the mortgage on your home should you die. This is becoming more and more common these days as home owners, as well as mortgage companies are looking for ways to protect the large investments that they make. The matter of whether or not you need mortgage life insurance is really not a question. You can never know when disaster will strike and that means that you will want to make sure that everyone who loves you is protected in this case.
More often than not, people who do not have mortgage life insurance find that the homes that they paid on for so long are lost when they die because of the fact that their family cannot make the payments. This is exactly the reason why most mortgage companies like to see a life insurance policy in place that will cover the cost of the home in the event of the main client's death.
Thanks to the many mortgage companies that are subscribing to this method, life insurance companies are now designing policies specifically for the purpose of mortgage pay off. There are two different types of life insurance policy for mortgage payoff and both have good and bad points to be looked at.
The first is very similar to the standard life insurance policy in the fact that it stays the same amount no matter how long you pay on it or how much you owe on the home that you are paying on. The beneficiary for the policy remains the mortgage company which can be bad news in one way. If you die at the very end of the mortgage due then the mortgage company still receives the full amount of the life insurance policy but they are required to send the family back the difference which can take a long time.
The other type of mortgage life insurance policy evolves with the terms of the mortgage. This means that the amount of the payout goes down as the amount due on the mortgage goes down. With this type the insurance policy becomes worthless at the end of the mortgage term.
You can decide which policy is right for you by trying out our life insurance calculator.
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