Life Insurance-Mortgage Life Insurance

TONY asked:


I just got a 50k on life insurance, my mortgage is 90k. I would like to put the 50k in my mortgage so I can be debt free quicker, however I would like to explore other/new posibilities

Brian Zeilinger

Nice Guy asked:


When people die with unfulfilled obligations (children, mortgages, car notes, and college loans), society absorbs the losses. What about child insurance for the extra expense suffered by society when a child is born? How far can this principle be taken?

Micheal Jenkins

loglog84 asked:


Hi

My family just bought a new home and the mortgage company keeps sending me mails such as

IMPORTANT NOTICE COMPLETE AND RETURN
mortgage protection insurance plan and life insurance plan.

They make it sound like I must fill these forms out and apply. I feel like they are just extra payments that I have to make. Are they necessary?

Thanks!

Dave Azad

ecemajor asked:


We are in the process of trying to refinance with a new mortgage company. We currently have homeowner’s insurance through Farm Bureau Insurance, as well as boat, automobile, and life insurance. The mortgage company we are refinancing with is saying that we must have and escrow account and pay their OWN homeowner’s insurance, instead of Farm Bureau. I don’t want to do this because we get a multi-line discount at Farm Bureau, and I like them. Can they do this?

Sallie Mondloch

just a regular guy asked:


My friend works as a financial advisor. He told me I get a 0% rate of return on my equity and principal. If I make interest only payments my tax deductions will be the same on the life of loan. If I invest $500 a month in to a fixed rate of 6% after 30 years I would have accumulated $500,000 in a tax deffered investment with the distribution not taxable. With this type of structured investment my only options would be a roth IRA or an investment grade life insurance. I would have to structure it with the minimum death benefit and fund it over 5 years with equal premiums so it would not become a MEC. Since I am so young and the cap on Roth IRA investments would be $4,000 a month the insurance would be my best bet to get a good return on my money versus a taxable or tax deffered investment. I could withdraw my money via policy loans at 2.6% which would be much less than a 33% tax on my money. He told me people in the mortgage industry only know about mortgages and would probably disagree
Also finance people typically don’t deal with mortgages and only invest discrestionay income for a fee so they would also probably disagree. He says a lot of people dislike whole life or UL’s because of bad info on them with commisions and so forth. Most people reccommend buying term only and mutual fund investments but after taxes if your getting 12% it ends up being only 8%. If I get an Equity Indexed Universl Life ( the index is the S&P 500) the average is 8% and I can’t lose any principal. It nets 7% after cost of Insurance. It is also an interesting fact that most “savvy” investors say it’s bad to buy any type of whole life however the top 5% of the wealthiest people in America all have whole life. It really makes you think.
I am not talking about home appreciation which my home would appreciate no matter what. I am talking about a rate of return on my principal payments which sits at an idle in the motgage banker’s pocket which I receive no interest from. The rate of return on principal payments is 0% and that is a fact. What I am talking about is investing those otherwise idle dollars into an investment which will make me money and take it. I have a $200,000 mortgage with interest only payments of $1000/month which frees up $500 a month which would ordinarily go to principal. If I continued with a standard amortized schedule my tax deductions would decrease yearly and after 30 years I would spent $568.000. With this plan I would have made $300,000($500,000- $200,000 lump sum mortgage principal payment due after 30 years with an interest only loan). What is your rebuttal?
I am not setting up a Roth IRA because I couldn’t fund it with $500 a month which would put me over the $4,00 a year cap.
I would like some information to support your answers. The rate of return on principal payments is 0% as well as equity. You will never realize that money again until you mortgage it again or sell your house and pay capital gains.
the distribution would be via policy loan @2.6% which is a lot less than a 33% tax liability. Amortized $1,500 a month. Interest only $1,000 amonth. 30 years or investinsting $500 a month= $500,000 tax free. I guess this is too compicated. What you suggest is I should put more money besides my amortized mortgage into the principal and that would make me more money? Why is this a bad plan?
http://www.kcmortgageplanning.com/tale

John Winchester

Joanna P asked:


Also if two people are on the mortgage do they both need separate insurance or one will cover them both?

Selene Ziernicki

Bird lady asked:


I was looking into buying mortgage insurance to cover me in case something happens. I found out this existed when someone I know died very suddenly. I went to the bank where my mortgage is and they told me they only offer it on new loans( my mortgage is 2 years old ). I was not offered this protection
when I applied for this mortgage ( actually it was a refinance of my original mortgage ) as I applied through a mortgage company.I was told the best thing to do now was take out a life insurance policy, which I already have, but that dosent cover my husband or myself if we lose our job or become disabled.Does anyone know where I could look into this or is it even worth it? The insurance company that carries my house and auto insurance does not offer mortgage insurance.Any help would be greatly appreciated! Thank You

Bryon Houseal

BYOB OOQ asked:


I currently have a $100k 20 year policy, but am thinking about switching to a $50k permanent policy. It’s the same price, only with the permanent one, we can cash out on it at any time. With the one we have now, we get nothing back.

We have mortgage insurance on the house, so if I were to die, it’d be paid off. My wife is a sham. I am on the birth certificate for two of the kids, so if I die while they are minors, they get social security benefits (I think?) So that being said, I’m thinking 50k should be plenty to keep my wife on her feet for a little while until she can find a job (although by then she might have a job already) What do you think? She says I should keep the 100k, she’s greedy.
Are you guys serious? I already switched it. The insurance company told me I wouldnt have to pay for 6 months if I transferred over because I’d have a credit. Oops. Hope I don’t die anytime soon, my wife is gonna be pissed!

Johnny Bonvillain

Todd asked:


Unfortunately, there is some extensive health history that prohibits the application of such traditional Term/Whole life solutions. From what I understand, actual Mortgage Life Insurance is a decreasing plan (following the decreasing principle of your loan) that is shared by both borrowers and designed only to pay off the mortgage in the event one or both borrowers dies.

Can you give me the names, ph#, email, URL, to any companies that offer this specific insurance product?

I have already asked my lender, loan servicer, and about 100 different B.S. online quotes Thanks.
Just to be crystal clear…I am not looking for Term Life Insurance, Whole Life Insurance, Variable, Universal, or any other typical live insurace vehicle. Eventhough the insurance industry has muddiedthe definiton; “Mortgage Life Insurance” is a specific product in it of itself.

Haley Binkley

insurancegal@rocketmail.com asked:


Hi! I am wanting to start selling insurance over the phone. Does anyone know a good source of leads that are fresh and cost effective? Please only answer if you genuinely know the answer to this and aren’t just trying to make money by recruiting me. Also, let me know if you do this same thing and are involved with any good companies specializing in this. Thanks so much for your help!

Veronika Wagner