There is talk on my future home’s group wall on Facebook that my condo should be ready for occupants in May and that they hope to have everyone moved in by the end of September. You have never seen someone move so fast to try to get their finances in order and to implement some kind of workable no frills budget such as I did the day I heard this.
I have managed to cut things back on some services to save $76 a month and have paid off and down some credit cards and also using some balance transfer low interest rates to save interest.
I am now got my brain on finding a new mortgage broker (one that is local rather than 55km away and as well as checking out term life insurance quotes as I plan on going that route rather than mortgage insurance that banks try to gouge you on.
Unlike my previous job who had life insurance on their employees for the wage x 2, mine is maxed out at 25K and unfortunately that won’t even cover 25% of my mortgage.
I was just wondering, what do my American friends do with their mortgages? I know our mortgages are very different than the US and I’m wondering about what happens if something were to happen to you or your spouse. Mortgage insurance or life insurance?
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I am glad you asked this, because I never understood what you were talking about, getting life insurance for your mortgage. Why would you insure that? If you die, the bank (mortgage company) sells your condo if the mortgage is in default, then any difference in what they get and what you owe is either paid to your estate, or is billed back to your estate. Essentially, when you buy insurance, your insuring the BANK. Why would you do that? My only guess was to try to preserve whatever equity was in the condo for your estate – the insurance would pay off the mortgage, then your estate could sell the condo FREE of what is owed to the bank. This helps the people who inherit from you. So I guess the insurance is for them (not just the bank) – ?
In the US we do not get life insurance for mortgages. We do get life insurance to be paid to our beneficiaries (spouse, kids, parents, etc) but then it’s totally up to them how they would want to use that money. OTOH, I have never owned a property as a single person (only married) so I don’t know what is recommended to do in that situation.
Excited for you moving in soon!
By Wendy on 02.05.10 1:44pm | Permalink
I have term insurance instead of mortgage insurance. Mortgage insurance seems like a rip off to me.
By Teena in Toronto on 02.05.10 11:49pm | Permalink
We have something here called Mortgage Protection Insurance and if I remember correctly the bank or mortgage company MAKES you carry it as long as you have less than 20% equity. But that’s in the US. And here in the states Mortgage Insurance is just really expensive term life insurance. The only way I would carry any kind of mortgage insurance is if it offered disability. You are more likely to become disabled than die!
By tawnya on 02.07.10 10:35pm | Permalink