Explore how mortgage disability insurance protects your home by covering mortgage payments in case of disability, offering peace of mind.
Mortgage disability insurance is a specialized policy designed to cover your mortgage payments if you become disabled and unable to work. It ensures that your most significant investment- your home- is protected during difficult times. This type of insurance provides financial security by directly paying your lender to cover the mortgage, or a portion of it, during your disability.
Mortgage disability insurance can be a valuable tool for those seeking to safeguard their home and financial stability in the face of unexpected disability. Still, it's crucial to carefully review the policy details and consider your overall financial protection strategy before deciding.
Mortgage disability insurance provides income protection by covering mortgage payments in case of the borrower's disability. In contrast, PMI protects the lender if the borrower defaults on the loan, which is typically required when the down payment is less than 20%.
Policies may have exclusions for pre-existing conditions or a waiting period before such conditions are covered. It's essential to read or discuss the policy terms with the insurance provider.
Unlike PMI, mortgage disability insurance is not required by lenders. It's an optional coverage that homeowners can purchase for added financial protection against disability.
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