Community Chat

[millieshops]

@151949I came from an insurance family - worked in my father's office and my brother's. 

I agree fully with those who say buy term life insurance, not mortgage insurance -  and buy it on both you and DH because if I understand correctly what you've told us, whichever of you is left will need that boost.

You can most likely find term life that will cover you for the length of your mortgage, but the survivor will be able to choose how to use the proceeds of the policy.  That's a huge difference from mortgage insurance as I understand it.

[Carmie]

When we purchased our home, we purchased mortgage life insurance offered by the lender.  We had three small children at the time and thought it was important.  We were in our early 30"s and it was only about $7 a month at the time and covered both of us.  

It is true that type of insurance goes down as the mortgage goes down.  In other words, if you have a $150,000 mortgage and 20 years later you only owe $50,000, you are still paying the same premium for less insurance, in our case, that $7 was no big problem.

The rate is is based on age and this type of insurance is usually not available to people over age 70 which is probably true of most life insurance.  Some life insurance is sold to individuals up to age 75 at quite a high cost.

These policies are sold to healthy people who don't smoke and they usually are valid for 5 to 10 years.  After that time,  the company can either drop you or allow you to renew.

[patbz]

@151949:  Although it's possible that when one of you passes the surviving spouse's SS will not change, frequently the surviving spouse will get a bump up in SS.  You can research this online or get a SS official center appointment to see if you do (or do not) get the higher amount.  Like everything with SS, there is commonly confusion on this point.

[151949]

When both spouses are on SS the spouse who is left after one dies can collect whichever they want - their own or their spouses. In our case my DH's is only $200 higher than mine. Of course I'd take his, but even so - the income coming to the home to pay the bills will essentially be half what it is with both of us.

[Tinkrbl44]

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@cmoose wrote:

You can still buy mortgage life insurance- but may be better off just buying a term policy for the duration of the loan. With mortgage life insurance, if you buy it from the bank you never see the money the bank just pays off the mortgage directly. If you own a term life policy and something happens to the insured person the beneficary gets the money and can use it how ever the need to at the time. There may be better ways to use the money, as mortgage money has low interest rates and perhaps there are other bills that are more of a burden than the mortgage.- Just a thought. 

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@cmoose   @151949   

ITA .....  get a term life policy for both of you for the length of the mortgage.   It will cover you financially, and gives you more flexibility than mortgage insurance.

[Cats3000]

I think the still sell so-called "Mortgage Cancellation Insurance" to cover your mortgage should something happen.  Before you buy it, you might want to go to a "Fee-Only" Certified Financial Planner and work with him/her on your financial package as a whole.

[Cats3000]

You're talking about "Private Mortgage Insurance".  The poster was asking about insurance that pays off the mortgage if something happens to the mortgage holder.

Two different things.

[software]

I am alone and I do understand.

My late hubby purchased mortgage insurance on property we owned, when he passed, it paid off.    But shop around, if you don't already have term insurance on yourself & hubby, possibly morgage insurance might be a better way to go.

@151949

[lulu2]

When we bought our home we were advised to take a term life policy (as opposed to mortgage insurance) on my husband equal to our mortgage.  After the mortgage was paid off, we kept the policy as the payments were so low.

[gidgetgh]

On term life insurance, for a couple, or mortgage insurance, wouldn't the premiums be pretty high if we're older?  Don't the premiums rise with age?  I've never had either one so I don't know, but I would think the premiums would be expensive over a certain age....whatever that may be.