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Mortgage & Refinancing Information |
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How Good a Deal Is Your Banks Mortgage Insurance Plan?
When you go to the bank to get a mortgage, you'll inevitably be asked to take out mortgage insurance. The idea behind mortgage insurance is simply that if something happens to you or your spouse then your loan will be paid off which is good news for your family and the bank. Most financial institutions act like they are doing you a favor by offering you mortgage insurance through their own group plan, but are they? The truth is that you could probably get a much better deal and at least an equal amount of protection by shopping around for your own insurance policy. Essentially, mortgage insurance is no different than term-life insurance. With both, your policy only lasts for a specified period of time and pays its benefits if something happens to you or your spouse. The real difference comes down to how much control you'll have over your policy and how much you'll pay for it. If you choose to use the mortgage insurance offered by the bank, you will not be able to customize a policy to fit your needs and you'll be lumped together with other borrowers under a group plan. Because of this, you will only have limited control over your policy. For example, through a third party provider, you would be able to choose your own beneficiary, decide how to spend the proceeds if necessary, and cancel the policy at any time. You would not have these options with a lending institution. Additionally, the bank maintains the right to not renew your policy and to cancel the policy when you sell the house. If you find your own insurance provider, you can make those decisions yourself. The other big difference is cost. A third party insurance policy's premiums will not go up, so you would pay the same premium today that you'd pay ten years from now. You won't get that same guarantee from a bank which can and probably will increase your premiums during the life of the policy. In most cases, you'll probably pay more through a bank anyway. In fact, you could pay as much as 40% more than you would if you shopped around and found your own insurance provider. Not to mention that the policy you take out through your bank will gradually decrease in value while a plan you select from an outside source will be worth the same amount during the entire policy period. Of course, many people don't mind paying more for their mortgage insurance because it's more convenient than dealing with insurance agents. The truth is that you can easily find a policy that fits your needs and provides affordable premiums via the Internet. An organization, such as the Hughes Trustco Group, can even generate quotes for you from multiple insurance providers so you'll know that you're receiving the best deal possible on the policy you want. The bottom line is that mortgage insurance is important and should be part of your home buying or refinancing preparations, but that does not mean you need to pay more or let the bank make important decisions for you. Instead, you should find your own personal plan from a third party provider which will let you stay in control of your policy and will save you money in the long run. Ivon T. Hughes, The Hughes Trustco Group Ltd. Canadian Insurance Broker - Get a FREE Quote TODAY!Tel: (514)842-9001 Email: info@trustco.ca Web: http://www.trustco.ca
MORE RESOURCES:
What are the hidden costs of refinancing a mortgage? Fox Business Mortgage refinance rates continue hitting record lows – here’s how to get the best deal now Fox Business 3 Mortgage Refinance Strategies to Consider in 2021 The Motley Fool What is a mortgage prepayment penalty fee, and how does it work? Business Insider What Is A Debt Consolidation Refinance? | Pros And Cons The Mortgage Reports Racked Up Holiday Debt? Refinancing Could Help You Pay It Off The Motley Fool PropertyGuru Tackles Top Home Loan Refinancing Misconceptions Among Singaporeans in New Research Taiwan News Buying a Second Home: What to Do and How Much It Costs Credible News Mortgage refinance: Everything you need to know Fox Business How to refinance your mortgage Fox Business How to decide if you should refinance your mortgage Fox Business Everything You Should Know About The New Mortgage Refinancing Fee That Goes Into Effect Dec. 1 Forbes Who's exempt from the new mortgage refinance fee? Fox Business Today’s mortgage refinance rates hold steady for third consecutive day | December 11, 2020 Fox Business Today’s mortgage refinance rates mixed — one key rate drops while two hold steady | December 15, 2020 Fox Business How do I get the most out of my mortgage refinance? Fox Business How to refinance your mortgage in 5 easy steps Fox Business Today's mortgage refinance rates don't budge for fourth consecutive day | November 24, 2020 Fox Business 10 things to know before refinancing your mortgage Fox Business 4 ways to get lower mortgage refinance rates Fox Business Today's mortgage refinance rates stay low with the election underway | November 3, 2020 Fox Business Today’s mortgage refinance rates climb upward — though one key rate holds steady | October 23, 2020 Fox Business Should You Lend Your Kids Money for a Home Down Payment? The Motley Fool How often can you refinance your mortgage? Fox Business 10 tips for getting the best mortgage refinance rates Business Insider Complete Checklist of Mortgage Refinancing Requirements Credible News Refinancing your mortgage? Don’t make this mistake Fox Business The best mortgage refinance lenders of January 2021 Business Insider Today's mortgage refinance rates hold steady at unprecedented lows | October 16, 2020 - Fox Business How to refinance your mortgage without closing costs Fox Business When should you refinance your mortgage? Fox Business How to Refinance Your Home | Home Lending Chase News & Stories Mortgage refinancing is about to get more expensive Pittsburgh Post-Gazette How to get a low-cost mortgage refinance Bankrate.com How much can you save by refinancing your mortgage? Fox Business The impact of the coronavirus on mortgage refinancings Brookings Institution |
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