Mortgage Protection

Written by Jeremy Horelick
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For a few extra pounds per month, you can buy mortgage protection that insures the timely repayment of your loan should anything happen to you. Most people don't factor in the possibility of their own death when buying a home, especially young people with their whole lives ahead of them. But lenders are all too familiar with this scenario, and as much as their sympathies extend to the remaining families, those lenders still demand the balance of their repayment.

The last thing you want to worry about after the loss of a husband or wife is how you'll handle the mortgage on your own. Ideally, your spouse will have a life insurance policy that will help you make ends meet, but this may not be enough. This is why many insurance companies offer mortgage protection in the form of a separate policy that pays off the remainder of your debt in one lump sum.

Sign Up for Mortgage Protection

It's worth spending the additional five or ten pounds a month for added coverage, especially when the fee is so nominal. Better still, the amount you pay into the policy is reduced as your term wears on since the amount you owe is also steadily declining. This progressive rate reduction means you don't pay any more than you have to, no matter where you stand in your payments.

This last point is especially important when you consider that your budget is already being stretched, especially if you're paying off your first mortgage. There are so many expenses and incidentals to cover, that you can't afford to spend any money frivolously. If you've already taken care of your life insurance through your lender, it's never too late to switch to a third-party insurer whose rates are lower, though you may face cancellation penalties for doing so.

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