Buying properties involve huge funds. You can either close the transaction fully in cash or a combination of cash and a Singapore mortgage loan. You can find resources all over the internet on 100% loan to value mortgage loans. But that does not happen in Singapore.
If you are the sole bread winner of the family, mortgage insurance is definitely something that you should think about. Because if a mishap happen which results in the loss of your life or permanent disability that prevents you from working, you don’t want your family to be burdened with the huge mortgage loan debt.
Even though a proper mortgage insurance plan has huge benefits in specific situations, most home buyers do not sign up for one because of certain myths. Here 2 of the most common myths.
1) Only wealthy people can afford or need mortgage insurance. This is far from the truth. Mortgage insurance is affordable and is not a material insurance premium amount when you compare that to the mortgage loan that you are taking up. The cost of mortgage insurance depends on the mortgage loan quantum, you age, nature of job, etc. When you take these into consideration, buying insurance on your Singapore mortgage is a small price to pay for your family financial assurance and peace of mind.
2) Only those that are of middle age or unhealthy should need insurance. This is not true. Accidents can happen. There are also certain insurance structures that allow you to get back the premiums that you have paid over the years when your mortgage loan has completed it’s course.
So before you write-off the need for protection on your mortgage loan, do consider the pros and cons and decide for yourself and your family.