Unemployment Mortgage Insurance Protection Can Cover Payments in Case of Job Loss
You may be considering taking out mortgage unemployment insurance, protection against the eventuality that you lose your job and your income, miss too many house payments, and risk losing your house. This coverage, also called job loss mortgage protection, can cover your mortgage payment if you find yourself out of work due to a layoff or certain other circumstances. Learn apply for unemployment mortgage protection insurance that may help you when you buy a home or manage your house payments in times of financial uncertainty.
Instructions
1. Research different plans to determine if you are eligible. Only certain individuals qualify for job loss mortgage payment protection programs, and plans differ. Even for free government programs, such as the HomeOpeners program in the state of California, there are restrictions, such as not being eligible if you own at least 10 percent of the company you work for. See the Resources section for some other common eligibility restrictions.
2. Calculate how much coverage you need and check this against the policy you are considering. Your costs will vary from person to person, and may include your monthly house payment amount, hazard insurance premiums, property taxes, and other fees associated with your home. Check if the insurance will cover these additional home-related payments. The amount the unemployment income protection will cover will vary depending on the plan and loan; it may be half of principal plus interest; it may be the full amount.
3. Compare premiums and coverage offered by different unemployment mortgage insurance plans. Bank of America and GE Casualty are two large lenders that offer this insurance at the time of this writing, and there are small lenders, too, as well as realtors and other agents.
For the plans that seem cheap, read the fine print to determine what the "catch" is - and there usually is one. For example, you may need to be affiliated with the insurer, its parent company, or one of its partners to be eligible. Or for the HomeOpeners program, the borrower must live in the house whose payments are covered.
4. Time the application before you feel you are at high risk. Before applying, assess your personal risk to insurers, who won't want to take on a borrower who will probably make a claim. Avoid applying for job loss mortgage payment protection if you're aware that a layoff is looming around the corner; you'll have to disclose that on the application and be unlikely to have your application accepted. And because of the vesting period that can be several months long, you won't be able to immediately claim any benefits should you be laid off soon after getting coverage, anyway.
5. After shopping around and comparing insurance program eligibility criteria, coverage and fees, contact the insurance company. Provide all information asked in the application completely, and be honest in all your answers. Make sure you understand all the conditions for making a claim before you sign the contract.
6. If your application is accepted, make sure all conditions of eligibility continue to apply throughout your coverage, and inform the insurance company if there are any changes.
Tags: loss mortgage, mortgage payment, application accepted, Case Loss, Cover Payments, Cover Payments Case
