Undoubtedly, one of the primary objectives of any financial institution is to retain as many customers as possible. Unfortunately, this often leads to the perpetuation of misconceptions within the industry.
The two most persistent myths about mortgage insurance are:
- You must wait until your mortgage renewal to switch mortgage insurance providers.
- Switching mortgage insurance may result in additional fees or penalties.
Actually, it's quite the opposite! However, it's not usually in the best interest of your financial institution to inform you of this as consumers typically obtain their mortgage insurance from the same institution that provides their mortgage.
It is possible to change your mortgage insurance policy at any point in time.
It is a common misconception that you must wait until your mortgage renewal to reassess your mortgage insurance. While it's convenient to link the two, mortgage insurance and mortgage terms are separate agreements. You have the flexibility to switch providers at any time.
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You can switch your mortgage insurance without incurring any fees or penalties.
The term "contract" in "mortgage loan insurance contract" naturally leads one to think of the difficulties associated with terminating such agreements. Similar to cellphone contracts or leases, ending a mortgage loan insurance contract can be challenging.
Unlike these examples, you can cancel your mortgage loan insurance without incurring additional fees or penalties. Simply inform your financial institution, and that's all there is to it! But why would you want to switch mortgage insurance providers if you already have coverage? There are two primary reasons:
- Your current coverage does not meet your specific needs.
- The cost of your mortgage insurance is disproportionate to the benefits it offers.
Did you know?
It is imperative that the new insurance coverage is activated prior to the termination of the existing policy.
While it's tempting to switch insurance providers immediately upon realizing potential savings, it's important to ensure uninterrupted coverage. Therefore, it is advisable to wait until the new policy is active before cancelling the existing one.
Need help? Contact a Proprio Direct real estate broker today. He or she will be able to help you make all your plans a reality!
