At the time that you take out your mortgage loan, your lender will offer you the opportunity to buy mortgage life insurance. Not to be confused with PMI which you must carry if you owe more than 20% of the value of your home, mortgage life is a policy that will pay for your mortgage payments or balance should you become disabled or die during the term of the loan. While this might sound like a good idea, for most people it’s just an expensive waste of money. The vast majority of homeowners do not become ill or disabled while they are paying for their homes. However, for someone with health problems, it may prove to be a Godsend.
You might be wondering about this time how you can qualify for any type of life or disability insurance when you already have pre-existing health conditions. After all, in most instances, if you can get these types of insurance at all, they don’t cover the things that are already wrong with you. The trick is to find a mortgage insurer who won’t require you to have a physical. Although these entities are few and far between, you can find them, especially now that Internet competition for your business is fierce and you have unlimited access to insurance firms all over the country.
It will definitely be worth your time and effort to try and find a company that will insure you without considering your medical conditions. Mortgage life insurance is considerably less expensive than regular term life insurance. Of course, there are many skeptics that will tell you that mortgage life is profitable for banks which means it can’t possibly be good for borrowers. They say that you can pay into mortgage life policies for many years only to have a claim that you make declined. They recommend buying regular life that will pay out the face amount if you should die rather than limiting your coverage to the balance left on your mortgage loan.
The whole purpose of mortgage life insurance is to help you pay to live if you are disabled or die, and in a few cases, it is worth the cost. Don’t let yourself be taken in by the ease of procuring insurance through the bank who handles your mortgage loan, however. Instead, seek out 3rd party options that can be tailored to meet the individual needs of your family.