Your LENDER'S Insurance
Option A
The LENDER owns the policy & is the beneficiary of it.
The benefit amount DECREASES as you pay down your mortgage, but your premiums will remain the same.
If you pay off your mortgage, you LOSE all of your insurance coverage.
In many cases, if you change mortgage provider - or sell your home - your mortgage insurance doesn’t move with you. You must REAPPLY or prove insurability again.
Occasionally, the insurance company underwrites the policy AFTER you die, and can potentially avoid paying the death benefit.
Offered from a lender
when you purchase a home.
Option B
LIFE, DISABILITY or
CRITICAL ILLNESS Insurance
A personally-owned flexible alternative.
YOU OWN the policy & YOU CHOOSE the beneficiary.
The amount of coverage DOES NOT DECREASE over time (even if you pay off your mortgage) - but you can decrease the coverage if you chose, thereby lowering your premiums.
You can take your policy with you if you transfer your mortgage to another lender, with NO NEED TO REAPPLY or PROVE INSURABILITY again.
The death benefit can be used in ANY way, for ANY purpose.
