Yesterday, we took a look at mortgage insurance, and when you might possibly need it to cover your home mortgage. Today we will look at another type of insurance tied to mortgages: mortgage life insurance.

While regular old mortgage insurance is designed to pay the mortgage if you default on your payments, mortgage life insurance is designed to pay the mortgage if you die. It may sound good initially, but the truth is that mortgage life insurance is one of those unnecessary insurance policies.

The fact of the matter is that your regular life insurance policy (term or whole) will cover such expenses. Because term life insurance costs so much less than whole life, and you can get so much more coverage, many experts suggest that you make sure that your term life insurance is enough to pay off the mortgage (and other debts). There is no need to buy another life insurance policy. Your beneficiaries get the pay out either way, and can apply your regular life insurance to the home mortgage.

Tags: home mortgage, personal finance, financial planning, finances,
financial goals, mortgage life insurance, mortgage insurance, life insurance