Mortgage Protection Insurance

For many of us, our home is our biggest investment as well as our family refuge. Losing a breadwinner can wreak havoc on the family’s finances — and their ability to stay in the home they love.

So, what’s the best way to protect your home in case something happens to you? Mortgage protection insurance is an option.

If you’ve recently closed on a mortgage or home equity line, you’ve probably received a flood of solicitations for mortgage protection insurance — usually disguised as official communication from your mortgage lender with few details on what they’re selling.

Mortgage protection insurance (MPI) is a type of life insurance designed to pay off your mortgage if you were to pass away — and some policies also cover mortgage payments (usually for a limited period of time) if you become disabled.

Note: Don’t confuse MPI with private mortgage insurance (PMI), which protects the lender if you default on the loan. With PMI, your family would still owe the balance of the loan if you passed away.

• No guesswork. The check goes straight to the lender for the exact mortgage balance, so there’ll always be enough and your family won’t have to handle the money.
• Disability protection. Some MPI policies make mortgage payments (usually for a limited time) if you become disabled or lose your job.