Buying a new home is exciting and scary at the same time. It is a big responsibility. By considering ways to protect your investment, you will have peace of mind in knowing that your home is protected. Mortgage protection insurance is a perfect way to protect your home in the event something drastic happens to you. Your loved ones will know that the home will be paid off and not be lost through foreclosure.
You can purchase your own mortgage protection insurance at a lower cost than you might think. You can also purchase disability mortgage protection. This pays you a cash value if you become disabled and cannot work. Let’s take a look at some of the guidelines that will be examined:
- Age of the Mortgage holder. As with any insurance, your age is a big factor in the amount of premiums.
- Gender of the Mortgage holder.
- Health of the Mortgage holder
- Length of Mortgage
- Total amount of Mortgage
All of these things will be considered. It is important to note that mortgage protection will not pay off the value of your home. It pays off the amount you still owe on the home.
A simple way to understand mortgage protection is to understand that the amount decreases and the mortgage decreases. The premiums decrease as well. Let’s say you have purchased mortgage protection for what you owe. This amount is $150,000 and you have 15 years to pay that amount off. Your first few years of payments will be higher than the last few years. So that when the home is paid off, the insurance policy, in effect, stops. That is not to say that you can’t continue paying for insurance protection, it will just be rolled over into a different kind of policy like a homeowners policy.
Visit with your lender, an insurance agent or a real estate agent to research all of your options. Talk to several, as insurance rates will vary from agency to agency. You need to make sure you have the best possible rate and that means getting several quotes.
Real estate is a sound investment, but good investments still have to be protected. It is a sound business decision to make sure all of your bases are covered. You just never know what the future may hold.