Mortgage payments will come at homeowners with full force. At time we need a respite from being inundated with mortgage payments. The best way to protect your family from a few missed mortgage payments might just be with the help of mortgage protection or MPI.
MPI purposes to pay off mortgage payments for a period of time if the borrower either dies or becomes disabled. To be clear, MPI is in no way related to private mortgage insurance (PMI), which protects the borrower in the case of a default. PMI is most useful should the breadwinner of the family abruptly pass away.
While MPI is a logical choice, it does come with its pros and cons, of which there are plenty of both.
Benefits Of A MPI
-No matter your health, you’ll be approved for MPI. Lab tests and medical exams aren’t even needed to get approved for MPI. Health nor how dangerous one’s profession is are taken into account.
-When the MPI kicks in, the insurance company will handle all payments. The money will go directly from the insurance company directly to the lender.
-MPI can even activate if the borrower becomes unemployed or disabled. Typically payments will only be made for a limited amount of time.
Negatives Of A MPI
-MPI is not flexible. It can’t be used for anything else than to pay off one’s mortgage.
-Insurance is never cheap. This trend continues with MPI. MPI can even cost more than term life insurance. Also be aware that not every policy guarantees that the price won’t change over the course of the coverage term.
-The policy’s payout reflects the mortgage balance. This means that even if your mortgage balance declines, your insurance payments don’t decline with it.
-Age restrictions due at times apply. Certain insurers won’t issue a 30-year MPI policy to a borrower already over the age of 45.
Traditional Term Life Insurance
When deciding whether to invest in MPI or not, many borrowers first consider traditional term life insurance. Term life insurance kicks in once the insured person dies. Should this happen, the insurance company will pay a person or organization a certain amount of money.
Term life insurance offers some benefits that MPI does not. For one, term life insurance is pliant and the proceeds can be offered to any person rather than be designated for the paying off of a mortgage.
The price associated with a coverage never increases. MPI policies have a tendency to sway, whereas a term policy remains the same over time.
The last significant difference is that while there are age limits, they are less restrictive than MPI.
Consult with your family and even mortgage lenders before opting for either an MPI or traditional term life insurance. Affiliated Mortgage is a mortgage lender with over 30 years of experience in all things real estate related. Affiliated Mortgage is the is a mortgage broker that serves the Phoenix area that is capable of answering and quelling any concerning questions you have surrounding a mortgage.
Mortgage payments will come at homeowners with full force. At time we need a respite from being inundated with mortgage payments. The best way to protect your family from a few missed mortgage payments might just be with the help of mortgage protection or MPI.
MPI purposes to pay off mortgage payments for a period of time if the borrower either dies or becomes disabled. To be clear, MPI is in no way related to private mortgage insurance (PMI), which protects the borrower in the case of a default. PMI is most useful should the breadwinner of the family abruptly pass away.
While MPI is a logical choice, it does come with its pros and cons, of which there are plenty of both.
Benefits Of A MPI
-No matter your health, you’ll be approved for MPI. Lab tests and medical exams aren’t even needed to get approved for MPI. Health nor how dangerous one’s profession is are taken into account.
-When the MPI kicks in, the insurance company will handle all payments. The money will go directly from the insurance company directly to the lender.
-MPI can even activate if the borrower becomes unemployed or disabled. Typically payments will only be made for a limited amount of time.
Negatives Of A MPI
-MPI is not flexible. It can’t be used for anything else than to pay off one’s mortgage.
-Insurance is never cheap. This trend continues with MPI. MPI can even cost more than term life insurance. Also be aware that not every policy guarantees that the price won’t change over the course of the coverage term.
-The policy’s payout reflects the mortgage balance. This means that even if your mortgage balance declines, your insurance payments don’t decline with it.
-Age restrictions due at times apply. Certain insurers won’t issue a 30-year MPI policy to a borrower already over the age of 45.
Traditional Term Life Insurance
When deciding whether to invest in MPI or not, many borrowers first consider traditional term life insurance. Term life insurance kicks in once the insured person dies. Should this happen, the insurance company will pay a person or organization a certain amount of money.
Term life insurance offers some benefits that MPI does not. For one, term life insurance is pliant and the proceeds can be offered to any person rather than be designated for the paying off of a mortgage.
The price associated with a coverage never increases. MPI policies have a tendency to sway, whereas a term policy remains the same over time.
The last significant difference is that while there are age limits, they are less restrictive than MPI.
Consult with your family and even mortgage lenders before opting for either an MPI or traditional term life insurance. Affiliated Mortgage is a mortgage lender with over 30 years of experience in all things real estate related. Affiliated Mortgage is the is a mortgage broker that serves the Phoenix area that is capable of answering and quelling any concerning questions you have surrounding a mortgage.
A Little About Affiliated Mortgage
A Little About Affiliated Mortgage
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