Mortgage protection is life insurance meant to pay off your home if you die. It is often a decreasing term policy where the payout drops as your loan goes down.
Who it fits
Homeowners who want their family to keep the house.
- Who buys it
- Homeowners
- Medical exam
- SometimesDepends on age, amount and company
- Coverage amounts
- In New York, mortgage credit life is capped at $220,000. A regular term policy can be sized to your loan.
What to know before you buy
PMI protects the lender, not you. It does not keep your family in the home.
The payout shrinks over time while the price stays the same.
Credit life through a lender pays the loan balance, not your family.
A regular term policy can be set to last while you have a mortgage, and the money goes to your family.
In New York, credit life for a mortgage is capped at $220,000.
Common questions
Is mortgage protection the same as PMI?
No. PMI protects the lender if you stop paying. It does not protect you or your family.
Can a term policy work instead?
Yes. You can buy term to last while you have a mortgage. Your family gets the money and decides how to use it.
Who gets the money?
With credit life from a lender, the loan is paid off. With your own term policy, your beneficiary gets the money.
