** GUEST BLOGGER: Shaun Banys, SunLife Financial

Updated Thursday, August 30, 2012 :: Views (9083)

MORTGAGE INSURANCE?

When buying a new house or condo, it can take time before you find the place you can call home. When you find it and you get your keys - it'll be worth the wait.

As you begin making choices about your new home, from finding the best mortgage rates to choosing your colour scheme, appliances, and furniture, it's good to know you also have choices when it comes to protecting your mortgage and your family's finances from the unexpected.

The two main concerns for most people are "what if I get sick?" and "what if I lose my partner?". Fortunately there are ways to protect your family in either of those cases which come in the form of Critical Illness and Life Insurance, but protection should begin right away!

Most people fail to protect themselves from the moment they sign the papers to purchase their home. I would say 95% of people will only consider insuring their mortgage once they sign the papers with the lender at closing. Unfortunately I've seen instances where an unexpected illness and/or premature death causes havoc with the closing of a property. Imagine finding your perfect home. You've given your down-payment to the seller, have been pre-approved with your lender, and are ready to sign on the dotted line once the home is ready for closing in 3 months. That house is now yours and you have a responsibility to buy that home when it closes........no matter what the circumstances are. If you or your partner passes away during that time you may be unable to secure that financing on your own which could leave you in a very big predicament. For the same reasons you protect your mortgage once you have it, consider putting that protection in place once you agree to purchase.

In my professional opinion protecting your family or partner with life insurance versus mortgage insurance through the lender, is the best choice over anything else. Here are a few reasons why:

	Mortgage insurance through a mortgage lender	Term life insurance and critical illness insurance from Sun Life Financial
Who does the insurance cover?	Only the individual(s) listed on the mortgage.	You, your partner and your children – you can protect your whole family, even those who are not responsible for paying your mortgage.
What does the insurance cover?	Only the balance of your mortgage.	Whatever you need it to cover. In addition to your mortgage, cover debts like your line of credit, credit cards, etc.
Who gets the benefit if I die or become seriously ill?	The mortgage lender is automatically the beneficiary.	You decide who gets the insurance benefit and how it's used – to pay your mortgage, medical expenses or your child's education – whatever is best for you and your family.
What happens as my mortgage balance decreases?	The coverage amount decreases as the mortgage balance decreases. When the mortgage is paid off, the coverage ends.	The amount of coverage you have stays the same for as long as you own your policy – unless you decide to change it.
What if I switch mortgage lenders?	You may lose the coverage and might need to reapply.	Your coverage stays the same – unless you decide to change it. Since your coverage is not tied to your mortgage, you can carry it with you if you move again.
What if I cancel my insurance?	You lose all the money you paid for the coverage.	Depending on your insurance, you may get some of the money back that you've paid in premiums.
What if I want to change my insurance?	You can't.	You may have the flexibility to adjust the type and amount of your insurance, or even convert to a permanent solution.

Critical Illness insurance most often goes hand and hand with Life and can be put together in a package. Critical Illness insurance provides a lump sum, tax free benefit on the diagnosis of a heart attack, cancer, stroke and 21 other illnesses. Furthermore our Critical Illness product provides a unique option whereby you can receive 100% of your premiums back as early as 15 years if you haven't made a claim! Did you know suffering a major health issue is key contributor to many mortgage foreclosures??

Please feel free to contact me at 613.567.9700 Ext. 2227 or at shaun.banys@sunlife.com for more information or any questions you may have.

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