Most homebuyers are so focused on the excitement of purchasing a home that they don’t give much thought to what they would do if something went wrong and they or their family were unable to make their monthly mortgage payment. If you do not have life insurance, or if you don’t think your existing policy would give your family enough protection, Calgary mortgage brokers offer Creditor Life and Disability Insurance to give you the peace of mind that your family will still have a home, no matter what happens.
What is Creditor Life and Disability Insurance?
Think of these kinds of protection as a financial safety net when your family needs it the most. Creditor life insurance is designed to protect the survivors from losing a home if an untimely death occurs. It pays the amount owed on a mortgage to the lender, so a family doesn’t have to. Disability insurance will make the monthly mortgage payment in the even of an illness or serious injury that keeps a homeowner from working.
Job loss insurance is another type of coverage available to homebuyers through Calgary mortgage brokers. Similar to disability insurance, it will provide for the monthly payments on your mortgage if the insured loses his or her job. If you are over 18 and under 55 and have worked for the same employer for at least six months (not yourself or your family), you are likely eligible. With all of these types of insurance available, your savings – and life insurance if you have it – remain protected and available to help your family through difficult times.
How Does it Affect Your Mortgage?
While the terms and conditions from different providers will vary, creditor life and disability insurance is maintained in much the same way as other mortgage-related insurance products like property insurance or private mortgage insurance. An amount will be collected each month as a portion of your mortgage payment, so you don’t have to worry about paying many separate bills.
Is It Right For You?
The lowest possible payment isn’t always the best way to go. If you are concerned that your death or disability might leave your loved ones unable to keep up with the monthly mortgage payment, creditor life and disability insurance can make a real difference. Calgary mortgage brokers can help you select the coverage that works best for you. Rates are based on the initial amount of your loan, your age when you apply, and are quite affordable. With disability coverage, a premium rate applying to the loan amortization period is also a factor.
Even if life insurance is already part of your family’s financial plan, creditor life and disability insurance along with job loss insurance can still perform an important function. Even if you have disability insurance through your employment, death benefits typically provide no more than the equivalent of two years’ salary, and disability benefits usually amount to two-thirds of your income. With creditor life and disability coverage you can rest assured, knowing it won’t be necessary to deplete your savings just to make your monthly mortgage payment. Other benefits include:
- You pay only for the coverage you need.
- Homebuyers have the choice of single or joint coverage (often at a discounted rate).
- Depending on the amount of insurance you need, you might not have to answer health questions or have a medical exam.
Guidance You Can Trust
Experienced Calgary mortgage brokers offer more than assistance with obtaining a mortgage. Of course, your broker will help you determine what you can afford and get the best mortgage rates available, but helping you meet your financial goals is your broker’s true calling. Just like a good doctor will suggest ways to stay healthy and prevent illness, a mortgage broker will discuss all the options with you, including Creditor Life and Disability Insurance.
Mortgages by Candice is here to help! If you are thinking about buying a home and not sure what you can afford, our mortgage calculator can help you estimate your payment. Our guide: Five Mistakes by Homebuyers That Could Jeopardize Your Mortgage can help you avoid common pitfalls often made by those new to the mortgage process.
No one will argue with the wisdom of paying off your mortgage as soon as possible, but it is also important to protect your loved ones from the unexpected. Creditor life and disability insurance can do just that without adding significantly to your monthly mortgage payment. Contact Mortgages by Candice today to learn more.