Buying a home is one of the most important transactions of your life. Of course, you want it to be as positive and successful as possible: that’s why it’s important to carefully assess your needs. Will you need mortgage insurance? You’ll want to determine the best coverage among the available options. “When your values are clear to you, making decisions becomes easier.”- Roy E. Disney
Is mortgage insurance mandatory?
This insurance is neither mandatory nor is it applicable to all situations. It is up to each borrower to analyze his or her needs and determine the best coverage for his or her situation. Term or permanent life insurance, disability, or critical illness insurance may also be valid options.
However, note that if your down payment is less than 20%, you will be required to purchase mortgage insurance as stipulated by Quebec law.
What is mortgage life insurance?
Mortgage life insurance is insurance that covers the balance of the mortgage when the borrower dies. It assumes the mortgage payments in the event of disability and pays a lump sum if a critical illness is diagnosed. Mortgage life insurance is designed to protect both the borrower and the lender. It is important to note that regardless of the insurer, this type of policy can be cancelled without penalty at any time.
Private or personal?
This is a frequent question, and an important one at that. For example, if you choose to purchase insurance from the financial institution that provides your loan, you will not own the policy. Your credit union or bank will reimburse themselves when you die. The premium is added to your monthly loan payment. This is an affordable way to protect yourself against any unforeseen event.
When you purchase personal insurance, you become the owner of the policy. You then have the right to make any changes you want to the policy at any time. You choose the beneficiaries and in the event of your death, the loan does not have to be repaid in full. The premium and the amount of mortgage life insurance are fixed.
Furthermore, you can combine your personal life insurance coverages when you purchase a policy. Confirmation of your insurability will be issued prior to the issuance of the policy rather than at the time of the claim.
How much does mortgage insurance cost?
The price of mortgage insurance varies a lot according to buyer profiles. If you wish to obtain prices adapted to your situation, discuss your situation with your Malouin broker! You will get a price adapted to your situation and tailor-made protection.
We are here to answer all your questions, because buying a home is and should remain an exciting adventure.