Updated: Nov 19
Mortgage Protection Insurance. This is a great way of securing your family's financial future. If you are a homeowner living in the United States, mortgage protection insurance (MPI) can help your family cover your mortgage under certain circumstances, like an unexpected death or terminal illness. Your family can avoid foreclosure. If you were to die, the mortgage would be left unpaid and your family could struggle financially. Mortgage protection insurance is a type of life insurance policy that is designed to pay off the balance on your mortgage loan or pay off mortgage monthly payments. It's also called mortgage life insurance or MPI and it's an important part of protecting your family from losing everything that you've worked so hard for. You have options to add on riders such as Disability Income, which would pay-out a monthly income to you due to an illness or accident, and you could no longer work. You can also add a rider called "ROP" which is "Return Of Premiums". At the end of your term, and you are still alive, the insurance company pays you100% back of all your premiums you paid into the policy.
Who Needs Mortgage Protection Insurance? If you have a home loan, then it's worth considering getting, especially if you only have limited life insurance, not enough life insurance, and whatever you do, don't count on your "Group Life Insurance". You have to separate those policies from getting your mortgage paid off. Ask yourself this question: If you were to die tomorrow, could your family pay off your mortgage and still have plenty of funds left over to survive on? If answered 'NO". Then you should look into mortgage protection insurance. It could protect loved ones from financial hardship.
How Much Does Mortgage Protection Insurance Cost? The cost of this type of life insurance depends on how much coverage you want, but in general, and depends on a few different underwriting factors. Insurance brokers will examine the remaining balance of your mortgage loan and how much time is left in your loan term. As with a traditional life insurance policy, they’ll also take your age, and overall risk level into consideration. It's really impossible to give a number without knowing the unknown. The best and easiest way is to fill out this short form here. A licensed insurance broker will send you a quote by text message. If you like the quote you receive, then proceed with the policy from there.
Who are the Beneficiaries of your Mortgage Protection Policy?
Your family. It could be your spouse, children, parents, or anyone you choose. You do NOT want the mortgage lender to be your beneficiary. You will want the money in your family's hands. People don't realize how important this part is. If your mortgage lender sells your loan to another company, your original lender will collect the funds and the policy is gone. Make sure you get a Mortgage Protection Insurance Expert to write your policy.
What are the Benefits of Getting Mortgage Protection Insurance? It may seem like one of those things you don't need, but getting mortgage protection insurance is actually a really great idea. There are many benefits to getting this type of coverage, and it's important that you know about them before you make your decision. The first benefit is peace of mind. If something were to happen to you, and you had no life insurance in place or little life insurance, your family would be left with the burden of paying off your mortgage loan as well as other bills. With mortgage protection insurance, they won't have that worry on their minds. They'll know that they will! Most policies also come with living benefits as well; Terminal, Critical, Chronic Illnesses and Nursing Home care. Meaning if you were to get diagnosed with one of those conditions, you could take funds out of the policy to use for bills, mortgage, whatever you need it for. Different options you might qualify to add on include Disability Income and / or Return Of Premiums.
Who Offers Mortgage Protection Insurance?
Only a licensed life insurance broker, agent or field underwriter can sell or offer mortgage protection insurance. An insurance broker that specializes in mortgage protection insurance is your best option. Just because you may know a licensed broker does not mean he or she specializes in the products that are available. Just like licensed doctors that specialize in different areas of medicine. One of the best agencies that specialize in mortgage protection products in the nation is: LifeInsuranceBrokersGroup.Com. They are partnered with the top insurance companies in the nation and will send you quotes by text message if you prefer no calls.
Worst case scenario?
I went on an appointment a while back to a home in Arizona to discuss mortgage protection insurance with a married couple. The husband was the sole provider and the wife was a stay-at-home mom with 3 children. The husband did not like the idea and thought the $68 monthly premium would be too much money to spend on $250,000 of coverage. He had no other life insurance or backup plans. If he were to die, he would force his loved ones to immediately experience financial hardship. He knew this was risky not to have a backup plan, but he felt he would not die for a long time. (I hear that excuse a lot) His wife Debra, was extremely angry at him because he was spending money every month on things that she felt he could easily spend towards a protection plan. After about 30 minutes of discussion, I could clearly see that this was not going to happen today. So, as I was getting my things together and getting ready to leave, the husband said "Ok I'll get the plan". Debra was extremely happy about his decision to proceed with the plan. At that point, I wrote up his application and submitted it to underwriting. Four days later, he was approved, and his policy was active from that day on. Keep in mind, these policies do not have a "waiting period". Once the first premium is paid, the policy is enforced and active. After leaving the appointment, my intuition took over and I just felt like this client was going to cancel it. It did not feel solid to me, and it was more of him pleasing his wife than it was him wanting the policy. A year went by.....then I received the text message below:
If you are interested in receiving a quote, either by Text Message or Phone Call. Please fill out the form here. One of our Licensed Brokers in your state will be contacting you with a customized quote tailored to your Mortgage Loan Balance.