how to get mortgage life insurance

how do you know if you have mortgage protection insurance

Watch out for offers asking for sensitive information like your social security number, bank account number, or credit card information. Most reputable companies will never ask for that information when they first reach out to you to see if you are interested in mortgage protection insurance.

is a mortgage protection plan worth it —

Let's say you own a mortgage of $250,000. The mortgage protection policy typically offers you $250,000 in term life insurance over the loan. If you pass away, the family members can take care of the debt and remain in the house. Sometimes, they're designed so that the policy will decrease in value as time passes (as you pay off the mortgage).

how to get mortgage life insurance

is life insurance a con

Be wary of offers asking for personal information such as Social Security, bank account, or credit card numbers. Most trustworthy companies will not solicit these details when first contacting them to find out if they would like to purchase mortgage insurance to protect you from the mortgage.

If you just recently purchased a home or refinanced your mortgage, you will likely receive many offers in the mail for "Mortgage Life Protection" or "Mortgage Life Insurance." In this article, we will take a look at the pros and cons of Mortgage Protection Insurance. You can answer the question: Is Mortgage Protection Life Insurance a scam or a smart move?

is life insurance a con
does home insurance cover death of spouse

does home insurance cover death of spouse

Scammers might use public information to reach potential victims, such as the sample postcard below. Scammers might be looking to steal the money you have. However, they are also seeking your data to be able to commit identity theft, so more than your money is at risk.

Life insurance for mortgages is specifically designed to make your mortgage payment upon loss of income or disabled. The policy typically has an increasing benefit (face) value that is reduced in proportion to the decrease in the value of your mortgage. The insured should name your spouse or a third party as the beneficiary so they can pay off your home in one lump amount. Your beneficiary could also keep the death benefit and continue to make monthly mortgage payments.

what does mortgage protection cover

If you've recently taken out a mortgage, we suggest you consider a term life insurance plan that considers your mortgage and income replacement to care for your loved ones when you pass away. The most common advice is to get 8-10 times your annual income in a 30 or 20-year life insurance plan.

Nobody likes to get inundated with offers for the same product – especially when the recommendations can be somewhat misleading. However, most people are underinsured when it comes to life insurance. The recommendations in the mail can serve as reminders – alerting you to a need for coverage. Taking on a large debt should cause you to reevaluate your life insurance.

should i buy mortgage insurance
should i buy mortgage insurance

Making sure that your family members are financially supported if you pass away prematurely or are disabled is essential. This is the bigger picture.

Scammers may use data from public sources to reach potential victims, such as in the example below. Scammers might want to take your cash, but a lot are also searching for your data to steal your identity, which means more than your money is at risk.

should i get mortgage life insurance

A bunch of insurance companies will be included in the pile telling you that you need to protect your mortgage with a "mortgage protection insurance" policy. There's usually some appeal to a mortgage holder to help their family stay in the home if they were to die suddenly.

Most of the offers you receive in the mail have a postage-paid response card enclosed. Life agents know they will receive a response rate of approximately 2% to 3%. The next step is to call you and schedule an appointment. Be very careful here. Most mortgage life agents are trained to sell you in one visit. It's called the "one-call close." Be prepared for a compelling presentation. However, insist that the agent leaves the quote with you. Take time to compare it to your other options. Tell them this is a big decision and you need time to shop and consider other companies.

should i get mortgage life insurance

Frequently Asked Questions

Is mortgage protection insurance tax deductible?
No. Typically, mortgage protection life insurance premiums are not tax deductible.


Once you pay off your mortgage, you will no longer have a lender requiring you to have homeowners insurance. While you aren't federally required to have it, keeping your coverage is essential since it protects you financially if your home incurs significant damage or someone is injured on your property.

 

The horrible company that sends deceptive marketing letters to those with new mortgages, offering mortgage protection life insurance. They make the letter appear very official, making it even harder for consumers to understand this is deceptive spam. Avoid this company.