Saturday, March 03, 2007
A Useful Mortgages Refinance Article
What is Mortgage Protection and Do I Need It?
By Mike Makler
Mortgage protection is a type of Life Insurance that will pay off all or part of your Mortgage if you die. Some forms of Mortgage protection will also make your monthly mortgage payments if you become injured or critically ill.
Many people feel I already have life insurance why do I need Mortgage protection as well? Many people have life insurance through their jobs. The problem here of course is if you loose your Jobs you loose your Life Insurance. Still others haven��t looked at their Insurance needs for over 10 years or more. The Majority of these are underinsured. Many people purchased insurance before they were homeowners or when they had Mortgages that were much smaller then they are now.
There are many kinds of life Insurance and there are many kinds of Mortgage protection insurance. Most Mortgage protection insurance falls into 2 different categories, the old kind and the new kind.
The old kind of Mortgage protection insurance is tied directly to your current mortgage. This means if you sell your house refinance your house you are no longer insured thus you must now get new insurance at a higher cost because your age has changed (your older) and possibly your health has changed. With the old kind as your Mortgage declines so does your coverage.
The new kind is independent of your mortgage. Thus if you sell or refinance your house you still keep the new kind of coverage. The Death benefit stays the same no matter what happens to your Mortgage. You have many options when it comes to the options with the new kind. In the case of 2 income earning families each income earner can be covered for all or some of the mortgage balance. Other options will pay your mortgage and optionally other bills if you can��t work do to illness or injury.
The most popular option actually will return all of the money you paid in when you are alive and well at the end of the coverage term. This means if you die your family and loved ones get the full amount of the death benefit but if you live you get all your money back. The way I like to look at this is lets say you pay $50 a month and you have a $200,000 death benefit if you die your family gets $200,000 but if you live 30 years from now you will receive every penny you paid in ($18,000). They pay you if you live and they pay you if you die.
Think of it this way you can put $50 a month in a bank or mutual fund and if you die 10 years from now your family gets $6,000 plus interest and/or dividends and/or capital gains or losses. But with mortgage protection insurance your family and loved ones get the full death benefit of $200,000. Of Course if you live you get your $18,000 back. What would you rather have a little bit of interest or capital gains of the peace of mind that comes from knowing your families and loved ones are protected?
(This is just an example your death benefit is based on your age and may differ from the above)
The best way to find out if you need additional coverage is schedule a no obligation appointment with a licensed Life Insurance professional in your area.
About the Author
Mike BigMak Makler Offers Financial Services (Life Insurance, Annuities and Mortgage Protection) in Florissant Missouri which is in North St. Louis County Missouri Just Across the Bridge from St. Charles Missouri and Alton IL Call Mike at 314 398-5547 Visit Mike's Web Pages:
For Insurance Questions:
Copyright c 2005-2006 Mike BigMak Makler
Article Source: http://EzineArticles.com/?expert=Mike_Maklerhttp://EzineArticles.com/?What-is-Mortgage-Protection-and-Do-I-Need-It?&id=435459
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Jack Joyce at 6:48 AM