Mortgage Payment Protection Insurance That Covers Loss Of Job FAQ

Isn’t there a sort of redundancy insurance or mortgage insurance provided by the state? Surely I don’t need accident, sickness and unemployment insurance.

If you have more than £8,000 savings you will not be eligible for income support and that means you will get no help. You should consider accident, sickness and unemployment insurance.

Is there a ‘state’ redundancy insurance?

If you took out your mortgage before October 2, 1995, you will receive no help for 8 weeks. For the next 18 weeks, the state will pay half your mortgage interest payments.

If you had your mortgage after October 2, 1995, you will receive nothing for 39 weeks. Mortgage insurance benefit is for the first £100,000 only. If you have unemployment insurance, you won’t have to worry.

So there is no state redundancy insurance or mortgage insurance if I can’t work. So what do I do?

The best approach is to buy accident, sickness and unemployment insurance, otherwise known as mortgage protection insurance. It is also referred to as accident, sickness and unemployment insurance and it provides financial protection.

How does Mortgage Payment Protection Insurance work?

The level of Mortgage Payment Protection Insurance depends on mortgage size. The Mortgage Payment Protection Insurance policy will pay, usually by making direct mortgage insurance payments to your lender. Mortgage insurance benefit will normally be paid for a maximum of 12 months. Mortgage Insurance payments stop when you return to work.

Can the Mortgage Protection Insurance cover the premiums for savings plans linked to a mortgage?

Yes. The Mortgage Protection Insurance can cover monthly premiums on an endowment policy, or an ISA.

Are there age limits for Mortgage Payment Protection Insurance?

Usually between 18 and 65.

Is there Mortgage Protection Insurance for the self-employed?

Yes, but check the small print of the Mortgage Protection Insurance, exclusions can make claiming redundancy insurance difficult. Most mortgage insurance companies will only accept a claim if you have involuntarily ceased trading. Even with unemployment insurance, you must have register for JSA.

Contract workers must choose unemployment insurance carefully. Most Mortgage protection insurance companies will accept a claim only if the worker is either on an annual contract that has been renewed at least once. With different contracts a redundancy insurance claim will be accepted only if they have spent 6 months with the same employer and the contract has been renewed twice. In this case unemployment insurance will pay only if the contract has been terminated early, and the unemployment insurance benefit will be paid only until the date the contract would have expired.

Do Mortgage Protection Insurance policies cover part-time workers?

Yes. Most Mortgage protection insurance policies will cover those working part time provided they work 16 hours per week.

Finding Cheap Mortgage Payment Insurance

In any case, it should be your duty to protect yourself and your home by taking out inexpensive mortgage payment insurance. Mortgage payment protection insurance usually pays out for up to 12 months. With some policies, it will become retroactive to your first day out of work.

Cheap mortgage payment insurance may be hard to find, especially if you use one of the high street banks or lenders as your source. To find inexpensive mortgage payment insurance, you should go with an independent, standalone payment protection specialist. One very good example of this is British Insurance. British Insurance is a highly ethical company.

Simon Burgess is the head of British Insurance; he cannot stress strongly enough that you need not take protection out from the same place you got your mortgage. He says that banks simply don't offer cheap mortgage payment protection insurance or give the best advice when it comes to buying a policy; standalone and ethical providers do offer the best advice. He states that the recent furore over some unethical selling of mortgage payment protection insurance policies just confirms how the big organisations can be taking advantage of their clients.

If you want to protect your home, British Insurance will give you excellent free advice and offers inexpensive mortgage payment insurance policies. Keep in mind that this particular type of coverage is very important, as you don't know what tomorrow holds. British Insurance is one way to ensure that you have this very important coverage, as inexpensively as is possible.

Mortgage Loans: No Money Down Mortgages

If you are considering purchasing a home but do not have the necessary 20% down payment you can still qualify for financing. Here is what you need to know about financing your home with no money down.

Financing your home without a down payment is possible; however, you will pay more for the financing. You need to be careful when selecting a loan with out a down payment as the lender could require private mortgage insurance. Your goal should be to avoid paying private mortgage insurance as this can add hundreds of dollars to your monthly payment. Here is what you need to know in order to get started.

Private Mortgage Insurance (PMI)

You can find a mortgage that does not require Private Mortgage Insurance with no money down, you just need to do your homework. Private Mortgage Insurance is an insurance policy that protects the mortgage lender from certain losses in the event of foreclosure. You pay the insurance premiums; however, the insurance does nothing for you except raise your monthly payment. There are a variety of loan options that can help you avoid private mortgage insurance.

Piggyback Mortgage Loans

Piggyback mortgages are a second mortgage loan that allows you to finance some or all of the 20% down payment. The most common piggy back mortgage is for 10% of the required down payment; however, there are mortgage lenders that will finance all of your down payment and closing costs. You will pay a higher interest rate on the second mortgage as this lender assumes more risk. This expense will save you money in the long run over private mortgage insurance. The interest you pay on your piggyback mortgage is tax-deductible if the home is your primary or secondary residence. Private mortgage insurance is not tax-deductible. To learn more about your mortgage options and how to avoid common homeowner mistakes, register for a free mortgage guidebook.

Mortgage Insurance Leads

The term mortgage can be defined as the legal device used in securing a property. A mortgage is also the method of using property as security for the payment of a debt. Mortgage insurance protects the lender against borrower default. If anyone is purchasing a home and is borrowing more than seventy five percent of the value of the property, it is required that the mortgage to be insured. This enables the buyer to purchase a home with as little as a five percent down payment.

Since mortgage insurance secures the lenders against defaulters, a home purchase with an insured mortgage and low down payment is no longer viewed as a riskier business by the lenders. Hence, an insured mortgage will help borrowers to receive the same low interest rates with a lower down payment. Even if the buyer is able to make a larger down payment, he/she may choose a high ratio mortgage, which will enable him/her to do some home improvements.

The insurance agent can keep an eye on the real estate market to get qualified Mortgage Insurance Leads. Advertisements and contacts with lenders can help the agent to get qualified leads. He or she can use online services to provide the leads. The qualified insurance lead fills out a form on the insurance leads provider's website, after which the lead service emails the insurance agent the information. The insurance agent then contacts the Mortgage Insurance Lead about the insurance coverage they are looking for. This method ensures that the agent will get qualified leads, and the agent can enroll for such a service for affordable price.

The Facts About Home Mortgage Insurance Online

Home mortgage insurance is coverage that protects your lender should you default, or fail to make payments, on your home loan. This insurance also helps lower the down payment for your new home. Traditionally, a down payment should be about 20% of the home price. Home buyers who can’t afford this kind of down payment sometimes opt to use home mortgage insurance. With this insurance, you can put down as little as 3-5%.

However, there are a few facts you should consider about home mortgage insurance before making a decision.

• Home mortgage insurance can be costly. It adds to your mortgage payment, after all. Sure, home mortgage insurance helps you get a home more quickly than you’d be able to if you weren’t able to make the traditional down payment of 20%, but if you are able to put down enough money avoiding the insurance makes more sense. You may also want to consider saving money until you can afford a good down payment.

• Home mortgage insurance is sometimes tax-deductible. That may not appeal to you now, since you’ll still be paying extra money throughout the year, but your increased tax return (or decreased tax payment) could change your mind. If you absolutely need home mortgage insurance, talk with the particular company you’re considering to find out if your payments can be deducted. You may want to choose one that does offer tax-deductible home mortgage insurance.

• Check with a mortgage advisor about ways to avoid home mortgage insurance. You may be eligible for special kinds of home loans that actually pay the home mortgage insurance payments for you. Of course, this will make your mortgage rates slightly higher, but it may balance out if the increased rates aren’t any higher than the home mortgage insurance payments.

In the end, you should always avoid additional costs or take steps to make them as low and rewarding as possible.

Private Mortgage Insurance: Cancel It and Save

Did you know that the Homeowners Protection Act of 1998 protects you from the abuses of Private Mortgage Insurance? If you are a homeowner that was required to pay for Private Mortgage Insurance by your lender, here is what you need to know about cancelling your policy and saving yourself a lot of money.

If you are a borrower with poor credit or have less than 20% for your down payment, your mortgage lender may require you to purchase Private Mortgage Insurance (PMI). This insurance protects the mortgage lender from losses if you default on your loan. These insurance policies can be quite expensive; legislation was enacted in 1998 to protect homeowners from mortgage lenders that abused PMI. This legislation set rules to protect homeowners by requiring insurance companies to terminate their policies once the borrowers meet certain criteria. These rules apply to any mortgage taken out after July of 1999 on a single family home. These rules do not cover FHA or VA mortgages or loans where the mortgage lender pays the Private Mortgage Insurance.

The legislation enacted states that Private Mortgage Insurance must automatically stop when a homeowner reaches 22% equity based on the original appraised value of the home. You can request that the PMI terminate when you have 20% equity if you have kept up on your payments. There are exceptions to every rule, and Private Mortgage Insurance is no different. If you have not kept up on your payments you may be required to continue your Private Mortgage Insurance.

Private Mortgage Insurance for the average home can cost as much as $500 per year. If you are unsure how much you are paying for PMI, contact your mortgage lender or escrow company for the details. To learn more about saving money on your mortgage, register for a free mortgage guidebook using the links below.

Mortgage Insurance Calculators

Mortgage insurance calculators are used to calculate different aspects relating to mortgage insurance. They can calculate the length of time for which a person will have to keep making insurance payments on his or her mortgage. This period is displayed in number of months.

Mortgage companies secure their sold mortgages by taking an insurance policy on them. The premiums of this insurance policy are passed on to the people who have bought the mortgage, and are bundled into their monthly payments. The insurance premiums may not run for the entire duration of the mortgage. Mortgage insurance calculators help to determine how long the mortgagor will have to continue insurance payments on the mortgage.

This calculation is actually a very simple task. There are six important figures that are required to be inputted into the calculator – the current property value, the value of the property at the time of taking the mortgage, the current interest rate, the current balance amount, the monthly payment and the expected appreciation rate of the property.

A person has to pay insurance on the mortgage until the time the value of the remaining mortgage reaches 78% of the current property value. Each month a payment is made, a portion of it goes toward the principal value of the mortgage. Hence, the mortgage value falls down month after month. Once the residual mortgage value is below 78%, the mortgagor is no longer liable to pay any insurance premiums on it. Alternatively, there are no insurance premium payments to be made after the mortgage balance falls below 80% of the appreciated property value.

Buyers of mortgages may waive insurance premiums in lieu of higher interest rates on their mortgages. But more often than not, this is a tricky decision to make – whether to go for higher interest rates or to settle for paying mortgage premiums. There are special mortgage insurance calculators that can help buyers of mortgages decide this aspect. Such calculators can help to compare the total interest costs over the mortgages and the total portion of payments done towards mortgage insurance premiums.

Free mortgage insurance calculators are available online. Several mortgage-related websites feature simple, easy-to-run programs which can help buyers decide insurance aspects of their mortgages.

Mortgage Refinancing – Title Insurance Basics

If you are refinancing your mortgage your lender will require title insurance when closing on the new mortgage. Here is what you need to know about this insurance policy.

Mortgage lenders require title insurance to protect them against third party claims on a property. Title insurance protects from losses due to a disputed title.

There are two varieties of title insurance. Mortgage lenders require you to purchase title insurance that protects them; this title insurance does not protect the homeowner. The second variety protects the homeowner and is generally not required by the mortgage lender. Lender title insurance expires when the mortgage is repaid; homeowner title insurance is valid for as long as you own your home.

When you apply to refinance your mortgage the lender will order a title search to make sure you are the rightful owner of the property. Your lender will charge you a fee for this title search. The purpose of the title search is to uncover any liens that may have been placed on the property. A lien on the property for example could be for unpaid property taxes.

Title insurance costs vary regionally depending on where you live. You may be able to save money by shopping around for a better deal. Refinancing you mortgage may enable you to find a cheaper rate for your title insurance; the insurance provider may discount the re-issue rate of your policy.

Private Mortgage Insurance – What You Need to Know to Avoid Overpaying

If you are in the process of taking out a mortgage and your lender is requiring you to purchase Private Mortgage Insurance, there are several things you need to know. Private Mortgage Insurance is expensive and can add hundreds of dollars to your monthly payment amount. Here are several tips to help you avoid paying this unnecessary expense or even drop Private Mortgage Insurance if you are currently paying it.

Private Mortgage Insurance is usually required for borrowers purchasing their homes with less than a 20% down payment. This insurance protects your mortgage lender from certain losses if you default on the loan. Private Mortgage Insurance is an unnecessary expense as there are loan programs that can help purchase your home without it.

80 / 20 Mortgage Loans & Private Mortgage Insurance

The easiest way to avoid paying Private Mortgage Insurance is to purchase your home using an 80/20 loan. 80/20 mortgages are actually two loans, one for 80% of the purchase price and a second loan for the remaining 20%. These loans are typically from two separate lenders; because your home is secured by two mortgages the interest rate on your second mortgage is typically higher. The advantage of using these two loans to purchase your home is that you will not be required to purchase Private Mortgage Insurance.

Mortgage Refinancing to Drop Private Mortgage Insurance

If you are currently paying Private Mortgage insurance on your existing mortgage, refinancing the loan could help you drop this costly expense. Private Mortgage Insurance is normally cancelled once you have 20 percent equity in your home; however, you do not have to wait this long. Mortgage Refinancing could save you a lot of money in Private Mortgage Insurance premiums.

You can learn more about your mortgage options, including costly mistakes to avoid by registering for a free mortgage tutorial.

Mortgage Life Insurance

Mortgage life insurance repays the entire or most part of the mortgage, when the borrower becomes critically ill from disease or accident, or suffers from death. So, the mortgage life insurance protects the family, co-borrowers, or co-guarantors from repaying the entire mortgage.

Depending on the insurance policy, the insurance company pays for the entire mortgage or maximum amount. For example, the insurance company pays up to maximum of $600,000. If the mortgage went over the maximum amount, the insurance company repays the portion of the mortgage up to the maximum amount.

The borrower usually purchases home thru mortgage. It takes a huge amount income to pay off the mortgage. In case of critical illness, debilitating accident, or depressing death of the borrower, the family needs to replace the loss of income to pay off the mortgage. With mortgage life insurance, the family does not need to worry about repaying the mortgage.

Mortgage life insurance differs from private mortgage insurance also known as PMI. The PMI protects the mortgage lenders in case of default of mortgage payment. The mortgage lenders risk the inability to re-sell the property high enough to pay off the mortgage. When the borrower lacks enough money for twenty percent down payment, the mortgage lenders requires PMI. As soon as borrower pays off or the home equity reaches twenty percent, the mortgage lenders automatically cancel the PMI premiums.

Mortgage life insurance is voluntarily. It is the decision of the borrower to sign up for the mortgage life insurance. In order to see the need, the borrower must sit with a certified insurance agent. The insurance agent will analyze the overall financial picture of the borrower.

The insurance policy starts at the same day of the approval on mortgage. Even though the borrower has not paid the first mortgage payment, the borrower still gets the benefit.

As the borrower pays off the mortgage, the mortgage decreases. Naturally, the coverage decreases as well. When the borrower paid in full amount of mortgage, the coverage is gone. And, the borrower no longer needs to pay the premiums.

When the borrower engages in mortgage refinancing, the borrower needs to qualify to the new mortgage for mortgage life insurance again.

Mortgage companies

Mortgage companies rely on mortgage insurance to protect themselves from defaulting mortgage borrowers. If a mortgage buyer does not make the payments, then the insurance company pays to the mortgage company. Mortgage companies buy their insurance from insurance providers and pay premiums on the same. These premiums are then passed on to the buyers of the mortgage. Buyers may have to pay for the premiums on an annual, monthly or single-time basis. The insurance payments are added to the monthly payments of the mortgages. Mortgage insurance policies are also called Private Mortgage Insurance or Lender’s Mortgage Insurance.

Generally, mortgage companies need to be insured for all mortgages that are above 80% of the total property value. If the mortgage buyer makes a down payment of at least 20% of the mortgage value, then the company may not require an insurance policy. But typically, mortgage buyers cannot afford to pay 20% of the down payment, and hence most mortgage companies require insurance, and these insurance premiums increase the monthly payments of the borrowers.

Thus, the mortgage lenders get to choose their insurance providers, but the borrowers of the mortgage are obliged to pay the premiums. This is where the controversy against mortgage insurance begins. But paying a mortgage premium allows the mortgage buyer to be able to buy the house sooner. This also increases the cost of the house and enables the person to upgrade to a more expensive house sooner than expected.

Sometimes the added cost to the borrower due to the payment of insurance dues to the company is added in the monthly payment itself. In such cases, the payment is called as a capitalized payment. Capitalization provides some benefits to the borrower, as the entire payment then becomes tax-deductible.

Mortgage insurance must follow the guidelines of the Federal Housing Administration (FHA). Both government and private financial institutions can provide mortgage insurance. The premiums payable on mortgage insurance depend on the purpose for which the borrower is buying the mortgage. In general, mortgage premiums on housing are higher than for other purposes.

Should I Buy Mortgage Protection Insurance?

There are two types of mortgage insurance. With one, you might not have a choice as to whether you have it. Private mortgage insurance is insurance that will protect your lender should you default on your loan. If your down payment is less than 20 percent of your property’s value, you likely won’t have a choice about whether you have private mortgage insurance; it’s required. But with mortgage life insurance, you get to decide.

Private Mortgage Insurance

Private mortgage insurance is required in just about any circumstance in which more than 80 percent of the value of the home would be under a mortgage loan. Private mortgage insurance is there to protect the lender. The cost of private mortgage insurance is typically 0.5 percent of the amount of your loan.

Mortgage Life Insurance

Mortgage life insurance is a mortgage insurance that can protect you instead of your lender. This type of insurance covers the amount of your mortgage if you should die, obtain a disability, or acquire a debilitating illness.

In most cases it doesn’t make much sense to have mortgage life insurance. The chance that you will become unable to pay the mortgage is generally small. And if that happens, your family or the others in your household will have to find other ways to pay all the bills—not just your mortgage.

Instead, you may wish to consider disability insurance. Disability insurance would help you pay all your bills—not just your mortgage—should you become disabled. For about the same amount you’d pay to take care of your mortgage, you could pay an insurance premium to cover more of your expenses.

Private Mortgage Insurance Tax Deductible

The private mortgage insurance allows the borrower to acquire a mortgage in which the down payment is less than twenty percent. The borrowers pay the private mortgage out of their pocket. Now, the private mortgage insurance is tax deductible for US residents.

Actually, the mortgage insurance is either government or private. Whether the mortgage insurance is government or private, the mortgage insurance is tax deductible.

To acquire the mortgage insurance is an alternative for piggyback second mortgage. The piggyback second mortgage is plain simply a second mortgage. The borrower acquires another mortgage on top of the first mortgage for down payment.

The tax deductible applies for modest income earners. That means the borrower earns up to $100,000. In case the borrower earns over the $100,000, the borrower can only write off the private mortgage insurance partially.

Additionally, the tax deductible only applies to new mortgage. The mortgage financing must have happen in the calendar year 2007. Unless the borrower made a mortgage refinancing for the mortgage on or after the calendar year 2007, the tax deductible will not be allowed.

This is good news to the millions of Americans. Millions of Americans pays for the mortgage insurance. The mortgage insurance only cancels out when the home equity or total amount paid goes over twenty percent of the principal amount.

More importantly, the mortgage insurance will be made affordable with this turn of event.

Like the mortgage interest tax deduction, the mortgage insurance tax deduction benefits millions of American. Now, the borrowers or home owners have a choice between mortgage interests of second mortgage or mortgage insurance premiums as tax deduction.

Dennis Estrada is a webmaster of mortgage calculators, mortgage refinancing, and piggyback second mortgage website which calculate the monthly payment, bi-weekly payment, affordability, refinance, annual percentage rate, discount points, and more.