An Example of Saving on Mortgage Insurance
How to Beat the Life Insurance Mortgage Rates and Get Better Coverage
Compare yourself, the qualified owner's, of the Mortgage Life insurance to the Mortgage Institution owning the life Insurance policy.
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Individual Term Insurance 40 year old couple |
Mortgage Institution Life Insurance 40 year old couple |
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2 Separate Policies Individually owed |
Only 1 Insurance Policy |
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$200,000.00 Husband $200,000.00 Wife |
$200,000.00 Total Coverage |
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Total Monthly Cost $44.27 |
Total Monthly Cost $56.00 |
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$400,000 if both die at same time or $200,000 each regardless of cause |
$200,000 only |
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Mortgage paid off or spend money as they wish: Survivor's policy still in force |
Mortgage policy ends, No option but to pay off mortgage, no cash left to live on. |
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The Benefit to you ... Costs Less and $200,000 more coverage |
Additional Benefits and Ideas
We know we can live without Life Insurance, but can those we care for? I do not advise insuring your mortgage, but to insure your income. Even when the home is paid off, there may not be sufficient money for them to live on. If you do not have enough cash to pay taxes, maintenance, utilities, food, etc. a house that is paid off doesn't mean much.
The most important issues are control and flexibility of your life Insurance policy. With personally owed coverage, the policy owner and / or beneficiary are in control; with mortgage institution life insurance, the institution is in control. If your beneficiary decided they did not want to pay off the mortgage upon your death and wanted to invest the money at a higher rate, than the mortgage rate they would have that option . There are many more options when you own the policy.
Once approved, the insurance policy you own cannot be cancelled, if it's renewable and convertible should you have a health problem. The mortgage institution can cancel each time you renew your mortgage.
You choose the beneficiary, not the mortgage institution.
You retain control of the policy, not the mortgage institution.
You can renew your mortgage through another mortgage institution, to take advantage of a lower interest cost etc.. If your health changes, you may not be insurable at the lower rates, or, you may not even be insurable.
Combine other life insurance needs to get a lower cost of insurance.
When you own the policy, it is portable and convertible for other purposes.
You can keep the policy as long as you wish because of being renewable and convertible.
Your beneficiary's receives the money tax free.
Beneficiary money is protected from creditors ( including banks ). The beneficiary decides whether to keep the money or pay the mortgage when the policy.
You can have coverage if you own the policy from age 75 to 85 and beyond. Some mortgage institutions only allow coverage to age 65. BW