? insurance on refi mortage

[Tia]

Never had it but thinking of adding it when we refi shortly. What do they call the kind of insurance if you lose your job or get sick and can't make your mortgage payment? Someone said once it was inexpensive to add.

ps. It's not the one when you don't own enough of a % on your house.

 

[dioxide45]

This type of insurance can usually be added at any time and doesn't need to be picked up only when you refinance or buy. You mortgage lender may offer this type of insurance. Though it isn't necessarily cheap. Credit cards offer this type of insurance, but in general it is very expensive. You are probably better to self insure and just put the amount you would pay for the policy in to a special savings account you setup that you don't touch. You will probably come out ahead unless you have a claim very early in the term.

To cover the loss of life, you should have term insurance that at least covers the cost of the mortgage and covers the term of the loan. In the event of death, the policy will be enough to pay off the mortgage.

 

[stevedmatt]

:Sounding like a duck: AFLAC!

Mortgage companies tend to overcharge for this type of insurance and it only covers your mortgage payment.

 

[momeason]

:Sounding like a duck: AFLAC!

Mortgage companies tend to overcharge for this type of insurance and it only covers your mortgage payment.

We generally do not buy extra insurance like this but I wish we had because my husband did lose his job and it sure would be nice to have the mortgage covered.
He retired after severence but it would be great to have that insurance because we lost one of our nest eggs too since he was in banking. Our extra cushioning next egg was 36 yrs of employee stock options. They are worthless now. We thought we had plenty to pay off the mortgage whenever we wanted, So much for the unexpected collapse of many banks..ours included. ( It was purchased for a song )
At least he still has a pension and a 401k so we are more fortunate than most. If we had just sold the stock options and paid for the house in 2007..hindsight is 20/20. We didn't want the taxes..now the stock is gone and we have a mortgage. Live and learn. We all have our sob stories of 2008 and beyond. At least we get lots of vacations to forget about it!!

 

[MuranoJo]

If we had just sold the stock options and paid for the house in 2007..hindsight is 20/20. We didn't want the taxes..now the stock is gone and we have a mortgage. Live and learn.

I can relate to this. Just exercized two options this year before they expired and I took a big hit. Several years ago, I viewed them as a nice retirement buffer. So it goes.

I've also heard the mortgage guarantee insurance (or whatever it's called) is expensive. But, I think these types of guarantees, like annuities, are being seriously reconsidered due to the uncertainty of the past 4+ years.

 

[Tia]

After reading around the internet via google it's called Mortgage Protection Insurance and can be an add on to your house insurance. I am going to check on Monday with State Farm.

It is true 4 years ago wouldn't have thought about adding such but with the recent economy

 

[bogey21]

I'm curious what the terms of the policies are. How long will they pay; Do you have to prove you are looking for a job; etc.?

George

 

[Tia]

State Farm told me today they don't have a Mortgage Protection add on.