Posted: Sat Apr 03, 2004 3:09 am Post subject: Unable to make payment? Avail Mortgage protection insurance
Borrowers unable to pay their mortgage dues due to accident, critical illness or lack of employment can get out of their debts with the help of mortgage protection payment insurance (MPPI) policy. The MPPI, also known as the ASU or Accident, Sickness & Unemployment Insurance includes a combination of insurances.
The features and aspects of the MPPI policy are given below.
An MPPI can provide you with benefits to cover up your mortgage related expenses and other costs on a monthly basis. You are free to choose the total amount of benefit except in some cases where there are restrictions on the maximum limit. You can receive the benefits for a maximum time period of 1 year.
It is better if you shop around so that you can avail the best MPPI policy. There are some mortgages that come along with free MPPI for 6 months or a year. But in case you are about to consider a remortgage and increase the loan amount, your MPPI coverage will also increase. The costs of payment protection insurance vary depending on your loan program.
There are various policies involved with MPPI thereby allowing you to choose the benefit you require. This implies that you can opt for benefits for accident and unemployment or sickness only or all the three. Usually all the policies have a deferment period, that is you have to wait for some time before you start getting the financial assistance from the policy. You may also be allowed to set the deferral period of your own.
As per the rules and regulations of the Department of Social Security, homeowners having bought their property after 1st October, 1995 should wait for 9 months in order to receive their MPPI payments from their states. These ASU benefits cover up with the interest on the first $100,000 of the loan amount.
Critical illness insurance:
This kind of insurance is included within the MPPI policy. It helps you in case of extreme illness by providing tax free benefits with the maximum benefit varying from $100,000 to $250,000. The benefits are usually paid within 28 days of medical diagnosis. But you are allowed to seek these benefits only once. Critical illness also allows you to avail life insurance coverage throughout the life.
Mortgage payment protection insurance undoubtedly helps you with cash when you are unable to pay for the mortgage on account of disability or unemployment. But before you apply for an MPPI policy, it is better to enquire about the amount of premiums required, the type of policy available, the possible rates, the amount of coverage and the term for which you can get the benefits. Finally you need to compare different policies and then select the most suitable one.
Posted: Thu Jun 15, 2006 11:43 pm Post subject: RE:
Hi,
You can apply for the protection insurance by approaching a few insurance companies and then selecting the policy that will provide you with the maximum benefits. However, your lender may also suggest a particular company.
Posted: Fri Jun 16, 2006 12:42 am Post subject: RE: Mortgage Protection Insurance
Hi,
In most cases, it is the lender who decides upon the company that will provide borrowers with the mortgage protection insurance cover. For first time buyers, the lender may offer the insurance as a part of the package. The homebuyer may accept the offer or he can take out the insurance policy from another provider.
But whether you accept the lender's offer or choose the insurance company yourself, the quotation of the premiums will depend mostly on the rate of interest and the loan term.
Sam
