Mortgage Disability Insurance

For most people, there is no larger investment than the investment in a new home and carrying a mortgage is the biggest amount of the debt they will ever have. When you get a new home, you undoubtedly know the stakes. If you default on that mortgage, you will lose your home, and your credit will be decimated. Most homeowners know that they have to do things to protect their investment in their home, like proper maintenance and up keep and insuring the home so that if it is damaged or destroyed in a natural disaster they will be able to recover. But what about protecting your home if you are injured or become ill and cannot work to make the money you need to pay your mortgage? What happens to your home then – and how can you keep from losing it if you can’t meet your monthly mortgage payment? That is where mortgage disability insurance enters the picture. With mortgage disability insurance, your mortgage payment will be covered even if you can’t work to pay the bills, so you have one less thing to worry about in a trying time. However, experts are split on whether you should get mortgage disability insurance or mortgage life and disability insurance, which covers your mortgage in the event of death as well. There are pros and cons to adding this extra expense onto your mortgage bill.

On one hand, the idea of having mortgage disability insurance, or even better, mortgage life and disability insurance is comforting. After all, you can rest assured that even if something happens to you, you won’t have to worry about your family ending up in the street. Death disability mortgage insurance means that if you should die, your loved ones won’t end up having to pay off or carry your expensive mortgage. Sounds good, right? But there is a downside. This kind of insurance can be very expensive and can get more expensive depending on your lifestyle, your health, and your credit. The mortgage disability insurance rates also go up and down with interest rates. This extra expensive may not be the smartest way to spend your insurance money.

According to many experts, instead of getting mortgage disability or mortgage life insurance, you should look into getting regular long term disability insurance and life insurance that are adequate to cover your mortgage, plus all of your other expenses. This may be a more cost effective way of protecting yourself against times of trouble.