Mortgage Repayment Protection
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Insurance policies which offer mortgage repayment protection can help disabled or chronically ill homeowners keep a roof over their heads. A good job and good health are not guaranteed; and life can throw you a curve ball. Not everyone is in jeopardy of losing income due to plant closures, mergers, and layoffs. But chronic illnesses or workplace accidents can derail the most carefully laid financial plan and leave workers up the proverbial creek without a paddle. Fortunately, in the event of a catastrophic illness, accident, or debilitating injury, certain homeowners' policies have repayment clauses to cover loans. Many provide coverage amounting to a certain percentage of the employee's monthly income to take care of living expenses while injured or disabled workers recuperate.
As the saying goes, "We don't plan to fail, but we fail to plan." And in order to plan for extenuating circumstances that can cost families their health or their homestead, employees should seriously consider securing mortgage repayment protection. An untimely accident or injuries can happen to anyone, regardless of income level or time on the job. "I returned, and saw under the sun, that the race is not to the swift, nor the battle to the strong, neither yet bread to the wise, nor yet riches to men of understanding, nor yet favour to men of skill; but time and chance happeneth to them all" (Ecclesiastes 9:11).
No one is immune from accidents, on or off the job. An assembly worker with twenty-plus years under his belt and looking forward to retirement can tangle with a sixteen-wheeler while off the clock. Personal injuries can put a worker in the hospital for weeks, followed by months of rehabilitation and physical therapy. Six months to a year later, the employee's injuries may still prohibit resuming a previous position. Under workers' compensation laws, plant owners are obligated to reassign the worker to lighter duty for an extended period of time. But what if the assemblyman still cannot perform at an acceptable level? When workers' compensation benefits run out and the unemployment checks stop; home and auto loans can continue to mount up and employees can fall desperately behind. Mortgage repayment protection can provide much needed relief for disabled and unemployed workers.
In a tight economy, corporations don't mind paying workers' compensation or unemployment insurance, but disabled employees can slow down production. And slower production equals reduced profits; which no company can afford. Many automobile collision victims may sustain injuries which prevent them from returning to work or finding suitable employment. Catastrophically injured homeowners may exercise the legal right to seek compensation by suing the guilty party for personal injury damages, lost wages, medical bills, therapy, or pain and suffering. However, hiring an accident injury attorney to collect damages will cost money and time. And without adequate mortgage repayment protection, permanently disabled employees could find themselves homeless and on the welfare rolls.
Employed homeowners who opt for mortgage repayment protection are well ahead of the game. Because a lot can happen to a borrower before a home loan can be repaid in fifteen to thirty years, banks have traditionally offered provisions to have mortgages wiped clean in the event of the borrower's untimely death or disability. Those who fail to plan for the loss of income due to accident, injury or death are like ostriches who bury their heads in the sand. Not facing reality could cost consumers and banks when homes are foreclosed due to a borrower's inability to pay. Insurance policies which provide mortgage repayment may cost a little more, but the extra dollars spent per month are well worth the satisfaction in knowing that the family will still have a home in spite of any catastrophic illness.
Another benefit of mortgage repayment protection is that a deceased borrower's survivors can remain in the home without worrying about taking out a second mortgage or the threat of foreclosure. Prior to initiating repayment policies, survivors had little recourse but to sell estates and move out of residences upon the death of the borrower. However, home loans which automatically pay off a mortgage provide a secure and stable financial future for loved ones. Widows and widowers don't have to pull funds from long term savings, and the kids' college fund remains intact. Homeowners who are enlisted in the U.S. Armed Forces, especially those who are actively involved in combat zones, may also qualify for home loan repayment protection under the Constitution. Provisions of The Soldiers & Sailors Civil Relief Act (SSCRA) state that courts may legally waive delinquent loans, if a service person can demonstrate that his or her active military duty has caused an adverse affect on an ability to keep mortgage payments current. The alleviation of home loan debt incurred by servicemen risking their lives for the country abroad could help stateside families bear the financial burdens associated with deployment.
Homeowners or potential buyers should shop around for banks and lenders that offer mortgage repayment protection as part of a long-term loan, or obtain estimates for additional coverage. The cost of such coverage increases monthly mortgage payments; so some borrowers may want to obtain independent financing. Buyers could also consider purchasing a less expensive property in order to add protection and stay within budget. Some life insurance policies also provide coverage for mortgage repayment protection. In the event of an untimely accident, injury, or even death, homeowners won't have to regret failing to make plans to provide for loved ones. With adequate coverage, workers that suffer chronic illness or long-term disability can remain secure in knowing that financial obligations, especially monthly mortgage payments are met.
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