One thing the big banks do very well is make it easy to purchase insurance when getting a mortgage. It literally is as simple as ticking a box on an application form. Keep in mind that for the majority of business owners, their place of business is their most valuable asset. Insuring the loan on that asset makes great sense. The trouble for small business owners is that they end up paying for this convenience.

Mortgage insurance is a huge profit center for the mortgage lender. The cost to home and business owners to insure their mortgage is much higher per $1,000 insured through the lender’s mortgage insurance than it would be to have a simple term plan. Insurance on your mortgage is a great idea and something you must have, just be sure to shop around before you tick the box.

Many people now have major credit card debts and mortgage insurance can help if you are struggling to repay your bills. For many people credit cards can be a very expensive. That is another reason to secure cheap mortgage insurance.

Most mortgage insurance from lenders designates the lender as the beneficiary. The premiums paid stay the same throughout the period of the mortgage, yet the amount insured drops with each mortgage payment made. Medical underwriting usually takes place at time of claim, not time of purchase, and coverage may be declined when you need it the most. Additionally, if you try to switch lenders, the insurance will also need to be changed and you may no longer qualify.

A simple term life insurance plan has many advantages. For example, once you are medically qualified the plan cannot be cancelled by the insurance company. You can designate whomever you wish to be the beneficiary. The beneficiary may decide to pay off the mortgage, or if the monthly payments are manageable, perhaps find another better use for the proceeds. A term life plan will also have less expensive premiums. The premiums will remain constant for the duration of the term and so will the benefit amount. Most importantly a simple term life policy will stay with you no matter who backs the mortgage. This will allow you to shop your mortgage around and get the best rates without fear of any insurance hassles.