eMortgage Health

A mortgage is a long-term financial commitment and you have to maintain the monthly repayments for the full duration of the mortgage. That's going to be over many years but non of us have the benefit of a crystal ball - so no one knows how your circumstances are going to change. So that must represent a big risk.

Consolidate Student Loans Mortgage Payment Protection Insurance (MPPI) is just one of a range of valuable insurances which includes critical illness insurance and life insurance, which you can use to reduce that risk and protect your family's finances. The purpose of MPPI is to ensure that you have the income to continue paying your mortgage repayments if you're off work for an extended period due to accident, sickness or unemployment.

Mortgage Payment Protection Insurance (MPPI) is a product designed to cover the risk represented by a mortgage loan.

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The reasons for needing mortgage payment protection insurance include redundancy, accident or illness. The balance between covering all expenses and not being able to afford your mortgage could be caused by a simple stroke of bad luck. Not having an insurance policy in place to cover your mortgage could result in your home being repossessed. Mortgage payment protection insurance protects against this eventuality.

Home Equity Loan Rates . Some mortgage lenders may try to coerce you into taking out an MPPI policy along with your mortgage. If this happens, make sure you find out how much extra the MPPI cover will cost you each month. Then get on the Internet and get some competitive quotations. Most people will find that the Internet saves them up to 60%!

Your mortgage lender will probably be very keen to sell you insurance alongside a mortgage. Some lenders will insist that you take out mortgage life cover which pays off your mortgage should you die. They will want to sell you building and contents insurance as well. They may offer mortgage payment protection insurance too, which is designed to pay off your mortgage debt should you fall ill or become unemployed.

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. Mortgage lenders will only quote you for the amount of cover you need to meet your monthly mortgage repayments. The author recommends that you extend the cover to include the cost of your home & contents insurance, mortgage life insurance, and the cost of any investment plan you have arranged to repay your mortgage (the investment plan only applies to mortgages where you are only paying the interest each month and will be repaying the capital at the end of the mortgage).

Mortgage life insurance pays off your mortgage if one of the people listed on the loan dies before it's paid. Because with each payment your mortgage decreases, so too will your life insurance coverage. Your payments on the other hand will not. This means that with each payment made to your mortgage, the cost for your mortgage insurance gets more expensive.

Equity Loan Rates . You can take out MPPI at any time. Some people wrongly believe that you can only take out MPPI when you arrange the mortgage.

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. If your employment is casual or seasonal you will not be able to claim on an MPPI policy. Every policy has what are called exclusions and seasonal and casual work is a typical exclusion. Exclusions are the circumstances under which a claim will be refused. Be sure to read these exclusions before you take out the policy and, if your circumstances mean that you're unlikely to be able to make a valid claim, don't buy the insurance! Exclusions on MPPI policies can eliminate 50% of potential claims.

Second Mortgages . The cheapest is not always the best. So don't automatically opt for the cheapest policy. The circumstances under which policies pay out do vary - so check them out cautiously. The premium quoted will be a reflection of the extent of the exclusions in the policy, the level of cover provided and the insurers general pricing policy.

Federal Consolidation Loan . MPPI is sold under a number of alternative names. So don't get confused. It can also be described as Accident Sickness and Unemployment Insurance, Payment Care and Payment Cover. In principle, they are the same - but remember to check out the exclusions!

Equity Loan
. Most MPPI policies say that you must be off work for a minimum period before you can claim. The longest period you'll find is 60 days but many policies reduce this to 30 days. Some will then backdate the payment to the first day you were off work. Look out for the details which you'll find in the policy's Terms and Conditions. Always check these out before you buy - and remember to compare like with like when you're comparing prices.

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. Don't confuse Mortgage Indemnity Insurance (MIG) with Mortgage Payment Protection Insurance. MIG p rovides insurance cover for a lender for any losses they might suffer as a result of a property on which they provided a mortgage being sold for less than the value of the outstanding mortgage. All payments under a MIG policy go to the lender, not you!

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. If you have Permanent Health Insurance your may not need MPPI. Check out the terms of you PHI policy and then make your mind up whether MPPI is adding anything extra.

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. If you already have Critical Illness Insurance be aware that there is a level of duplication with MPPI. MPPI will pay an income during the insured period for any illness that prevents you from working. Critical illness Insurance pays out a lump sum if you have any of the chronic illnesses listed on the critical illness policy (other conditions apply). So if you have a valid claim under your critical illness policy, you will probably also have a valid claim under your MPPI policy. However, if the illness that's keeping you off work is not listed on the chronic list then only your MPPI policy will payout.

Equity Loans
. Do shop around. You'll find that the Internet is the cheapest place to shop for MPPI and many web sites enable you to arrange cover immediately online.

Student Loan Consolidate Michael is the chief editor of Express Life Insurance offer life insurance and mortgage insurance.

Consolidate Loans Additional reading - What is Mortgage Payment Protection Insurance? Additional reading - What is Terminal Illness Insurance?

Home Loans Refinancing Michael Challiner has 15 years experience in financial services marketing at senior level, the last 5 of which specialised in online marketing. Prior to that he spent 15 years in advertising with two of the world's top advertising agencies, J Walter Thompson and Saatchi & Saatchi.

Consolidate College Loans Michael is currently the editor of Express Life Insurance and Andromeda Webs Ltd

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