But, what some people don't realize is that while protecting their mortgage is a great idea, they have options for how they do it!
Here’s what we wish more people knew: using life insurance as mortgage protection could save you thousands and give you more flexibility. Not only that, you’ll end up with better coverage.
Why is mortgage insurance a good idea?
Protecting your mortgage is a smart move, especially if you want to help ensure your family can keep the house and pay it off if something happens to you. But if mortgage insurance is so helpful, why are we talking about mortgage protection? Are they different? In fact, what is mortgage protection?
When you buy typical mortgage insurance, your monthly premiums stay the same, but the coverage amount actually decreases as you pay down your mortgage. That’s because this type of insurance only covers your outstanding mortgage balance.
But if you go a different route and use life insurance as mortgage protection, you get value for your money. Because with life insurance, you're always covered for the same amount as long as you have the policy, even if you sell your house or change mortgage lenders.
How does using life insurance as mortgage protection give you more flexibility?
Another difference between mortgage protection and mortgage insurance is who gets the money. Mortgage insurance covers only the outstanding amount of your mortgage and is paid directly to your lender.
By choosing mortgage protection using life insurance, the money goes directly to your loved ones – whomever you’ve chosen to be your beneficiary. They can use the funds however they need, whether it's paying off the mortgage, covering childcare expenses or handling other financial obligations. Talk about flexibility!
How does mortgage protection give you better coverage?
If you’ve made it this far, you know that typical mortgage insurance covers the balance of your mortgage, but you’ve got options.
Life insurance as your mortgage protection solution could cover your mortgage, while also creating a financial safety net for your loved ones. They can use the money to pay off debts, handle child care or tuition expenses, or cover day-to-day living costs. In other words, it can cover whatever they need it to. It's about securing their financial well-being too.
Ready to secure the future of your loved ones? Prospr advisors know what they’re talking about! Book a free consultation to look at your mortgage protection needs.