“Mortgage Protection” through Term Life Insurance

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“Mortgage Protection” through Term Life Insurance

Purchasing a new home can be both exciting and stressful. For many people, a mortgage is the largest investment they will ever make in their lifetime. But would your loved ones be able to cover mortgage payments if something unfortunate were to happen to you? Let’s not sugar coat it. What if they walked out of the house tomorrow, got into a bad car accident, and died? Most people don’t want to face this possibility, however that doesn’t make the reality of the possibility go away. Mortgage Protection through Term Life Insurance helps to solve those  problems.

Don’t let worries like this add to the stress of purchasing a home. Term life insurance offers an affordable solution to mortgage protection and can be tailored to meet your unique needs.

Firstly what is term life insurance? Term life insurance can be an affordable life insurance option. It provides a fixed death benefit for a fixed premium payment, over a fixed period of time. Certainly your premium payments are guaranteed and will remain level for the term you select. This is an ideal solution for individuals in the peak of their life. They are at that point where they are establishing themselves in their careers, their families, and are building wealth over time.

Common Concerns

  • “But my bank is offering me mortgage insurance”
    • Your bank or other mortgage lender will likely recommend their mortgage insurance.
    • Regular mortgage insurance offers you little control in what happens to your coverage.
    • The lender is the beneficiary and decides how proceeds are spent while your coverage declines as you repay your mortgage.
  • Do I get my money back if I outlive the term?”
    • There are certain term policies that are available in the event you’d want to get some money back. They are referred to as Return of Premium (ROP)
    • You can choose to get either 50% or 100% of the premiums you’ve paid into the policy if you outlive the term.
  • Will it build cash value?”
    • Term doesn’t have a cash value component like Whole Life Insurance.
    • ROP option gives you money back if you outlive the term.

Flexibility of Term Life

With Term Life insurance you’re always in control. You own the insurance policy. Therefore you’re deciding who the beneficiaries are. In addition your coverage amount remains the same even though the mortgage balance decreases. Moreover if you decide to move your mortgage to another financial institution, your term insurance goes with you, not the institution. Most importantly you do not have to reapply for coverage and your rates won’t increase.

Term Life Insurance should not be limited to only mortgage protection. That is to say that it can be used for a range of time-sensitive expenses, like Income protection and education expenses in the event you die prematurely. As a result you’re children will still be financially covered as if you were still there to provide for them.

Furthermore, you’ll have the option to renew your  insurance policy once the mortgage is repaid or convert to a permanent or universal life insurance plan. Premiums and the death benefit are guaranteed plus there’s a wide selection of terms, issue ages and valuable built-in features.

Contact us for an consultation on your Insurance Needs