mortgage protection insurance (again)

behaviorkeltonAugust 22, 2006

I've seen people talking about this issue, but I can't find any reference to how much this stuff costs.

So how much would it cost to, say, insure a $100,000 mortgage.

I'm talking about the type of insurance that will pay your mortgage payment if you should lose the ability to work.

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Chemocurl zn5b/6a Indiana

I would think that there would be a lot of factors considered in determining the cost of insurance...age for one.

Is there only one name on the mortgage?

I wonder how that would work if there were 2 names (and most probably 2 incomes), on the mortgage.

I think it is a considerable amount of the payment, and I never had it, but instead was comfortable with having savings, in the event of a major illness or injury.

Sue

    Bookmark   August 23, 2006 at 8:41AM
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western_pa_luann

We just took out a regular insurance policy in my husband's name (I am a SAHM) for the balance of the mortgage (after our down payment). WAY cheaper....

    Bookmark   August 23, 2006 at 9:16AM
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steve_o

A properly-valued life insurance policy will function in part as your mortgage-replacement insurance, your credit-card insurance, your installment-debt insurance, etc.

However, most life insurance policies do not cover disability, which is a far more likely occurrence over your career than death. If you cannot work at your job, what could you do which would earn you enough money to continue to pay your bills? Some workplaces offer disability insurance, either paid for by the company (rarer and rarer) or as a group policy for its employees. The thing to watch for there is "own occupation" -- cheaper disability-insurance policies will only pay you for your disability if you are unable to perform any job (even filling boxes on an assembly line or stuffing erasers on pencils) -- regardless of whether the income that new job provides remotely resembles your old income. In that case, you probably qualify for SSDI anyway. So, if you go for disability insurance, make sure it covers your income for the kinds of jobs you have been educated to do.

    Bookmark   August 23, 2006 at 10:38AM
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Karen_sl

And, here is something you all should consider....getting this insurance from your insurance agent not the lender.
When you get the insurance from the lender they always get the money.
If you get insurance from an agent you are the beneficiary.
An example..
Mortgage life thru the bank..
Mr. bread winner dies, mortgage paid off. No extra money for spouse.
Mortgage life with insurance agent...
Mr. bread winner dies, spouse gets the money...she may continiue to pay payments and if necessary have $$ for repairs.
I sold insurance for years and saw a person in great trouble because had life insurance with mortgage company. When her spouse died, the house was paid for...wonderful. She needed a furnace and a roof but had no $$ for that. With the life with her insurance co, she could have made these payments and her repairs while she got on her feet enough to get a job and continue.
And, do you all know that most times the insurance is cheaper thru an agent as opposed to the bank??
Ok, sorry, that was my 2 cents!!
Karen L

    Bookmark   August 23, 2006 at 11:04AM
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devorah

Karen nailed it. If you aren't required to buy mortgage insurance, don't do it. Get term life insurance instead.

    Bookmark   August 23, 2006 at 1:35PM
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behaviorkelton

OK... so what can a 41 yr old healthy guy expect to pay for term life insurance.
Or is there somewhere I can get a free quote without having to interact with a "come on" sort of marketing?

    Bookmark   August 28, 2006 at 7:55PM
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steve_o

You probably can find some prices for companies which do business over the Internet, though you'll likely have to supply them with an email address (make it a disposable one). Or you can call an independent broker in your community; at least he/she is not representing just one line. Or just get really good at saying, "No, thank you."

    Bookmark   August 29, 2006 at 8:30AM
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kudzu9

grace101-
I see you just joined these forums. If you didn't read the policies before you joined, you need to know that these forums prohibit commercial solicitations, such as you've just made, and that your membership can be cancelled for violating that policy.

    Bookmark   February 1, 2007 at 12:26AM
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joyfulguy

If the lender furnishes the insurance, the benefit goes to them: if the homeowner buys it, he (well, his survivors - he'll not have much need of it, where he goes) gets the benefit, as mentioned above.

A problem with mortgage insurance, though, is that the amount of insurance is the amount of the principal still owing - that decreases over the years, more rapidly near the end.

However, if you buy your own term insurance, usually you'll get a larger amount for the same premium, but the amount of benefit will stay constant throughout the full term.

If you arrange to delay death for a period, there'll be some extra benefit over the amount needed to pay off the mortgage that the survivor can use for other purposes.

It is worthy of consideration that most of us are about 4 times as likely to suffer disability as death during our working years.

ole joyful

    Bookmark   February 1, 2007 at 1:24AM
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