Actually, in a way, mortgage life insurance for Traverse City, MI is both for the life of the mortgage and for the death of the person whose name is on the mortgage. The insurance premiums will usually be paid by the person or people (whose names appear on the property purchase loan agreement known as a mortgage) but it is the lending concern who will be paid if the named person(s) should die before the end of (the life) of that loan.
Those whose names are on the policy for mortgage life insurance in Traverse City, MI will receive no financial benefit should they die with mortgage payments still outstanding but, their dependents (usually family members that lived with the deceased in the mortgaged property) will get to own that property free of any outstanding loan obligations. This is the real reason why sensible mortgages cover all bases by taking out mortgage life insurance.
Standard Life Insurance Compared To Mortgage Life Insurance
A standard life policy is one that pays out a pre-agreed sum of money in the event of the death of the policy holder. Should the policy holder happen to have an outstanding debt in the form of (as yet) unpaid repayments on a mortgage of any sort; then, the beneficiaries of the standard life insurance are not obliged to pay up any short fall on the deceased’s mortgage(s). Under such an arrangement, dependents living in the mortgaged property might not actually have any security. A mortgage linked life insurance policy should ensure that those living in the property do not get thrown out into the street due to a foreclosure.
What Happens If A Mortgagee Is Still Alive But Is Unable To Complete The Payment Schedule?
This depends somewhat on the actual terms of the mortgage, the amount still owed at the time of default in repayments and the reason for that default. If the person defaulting on their loan has what is known as mortgage life & disability insurance then, if the default is caused by the mortgagee becoming disabled and unable to work and earn sufficient to make their repayments, it is possible that their insurance company will take over the balance of the loan.
But, this will not be the case if their inability to make repayments is a result of retrenchment, unemployment and absence of sufficient savings or other assets. In such cases, maybe a prior investment in mortgage protection insurance might have come to their rescue.
Mortgage life insurance in Traverse City, MI is a sensible option for those with outstanding home loans but there are a lot of variables involved when it comes to choosing your policy. The independent agency run by the firm of Johnson & Associates Insurance can assess your particular circumstances and come up with the plan that is best for you.
