❌ Don't Buy Mortgage Insurance ❌

[@SteveKarrasch]

Do you need help in Surrey Real Estate? Book a call: calendly.com/stevekarrasch

[@calgaryyipee]

It has helped me personally go to sleep much easier . Lemme explain : So i enrolled myself into mortgage insurance which includes unemployment very recently .I am currently finishing up building my secondary suite and had to dig into my reserves to build it. and had to deplete my 6 month emergency fund. With current job market I was at unease with a lack of a emergency fund and thought I could be out of work tomorrow and that could lead to worser outcomes. Having said that I plan to build up my emergency fund back and then get off insurance.May be I shouldnt be that pessimistic but I like to plan for worst days.😊

[@SM-un4ho]

This is truly a great advice that i was not aware of it inspite of me been working as a mortgage specialist over 15 years ago.

[@ludwigvonbear8548]

Creditor Insurance has value. The moment you have a debt, the need exists. You may be able to find a better value product by shopping the market with individual licensed insurance advisors. The actual winning strategy is to buy individual insurance policy before signing mortgage. The second best is to walk out with creditor and shop for alternate after. For those too busy / lazy this is a legit product to keep as claims get paid. Imagine if someone says no b/c of your video without understanding needs/backup plans and then passed away shortly after signing.

[@j.p.5058]

I was really surpirsed when my lender started pushing this in the last moment before I could get financing. Very annoying. Thanks for the insights!

[@ludwigvonbear8548]

Regardless of advisors skill level: New debt = new need. They should have brought up topic at beginning of the process to better explain value. Should not be pushy either - too many under qualified lenders IMO.

[@SheilaPrummel]

The salesman for my truck upsold me on insurance, too. His reasons were: 1. I can claim the expense on my income taxes. 2. It kicks in immediately upon death, and not six months later, a lender will size the vehicle as soon as payments aren't made, leaving your beneficiaries with those payments or forfeiting the vehicle. I may have gotten snowed... I don't know 🤷🏼‍♀️. I will look into it, though. My budget is tight enough, and I do have all the policies I need through my insurance broker

[@ludwigvonbear8548]

You can’t write it off in Canada, but it will pay the balance if you pass away (assuming it’s not self inflicted or from illegal activities).

[@maryma5044]

Steve, thanks for sharing this tip, really did not know. I remembered the bank asked me to buy, I said need to think about it, then I forgot

[@shawnschafer9795]

Agreed, broke my collar bone last summer had to be off work for 2 months before it would even kick in. Was a total waste of money.

[@chaos24x]

To correct what you are saying. I think you are getting critical illness insurance mixed up with disability insurance. Critical illness insurance will pay off your mortgage the same way life insurance does (however there are probably also some policies out there that make payments for you instead). I actually think critical illness insurance can be more important than life insurance. For example, if you get cancer, not only does your income stop or get reduced, your expenses are likely to go up and someone else might need to take time away from earning money to take care of you. Having siad all that, I do agree that you should look at your options for these coverages outside of your bank. If you dont't have enough time before the closing/completion date, you can always get it through your bank before going out to look at your other options. Insurance on a mortgage can be cancelled at any time.

[@127gentry]

Please correct me if I am wrong, but rhe monthly premium typically decreases too, since these insurances represent a percentage from your debt. In your private case, they might do the opposite, as you age

[@ludwigvonbear8548]

Premiums due creditor typically stay level despite value of debt/coverage decreasing. Marginal utility probably decreases at the fastest rate for the last 1/3rd of mortgage ammortization.

[@josephstymest6089]

Sorta like cc insurance - they only make the minimum payment if you become unemployed. It aint worth it.

[@Pugyeg]

Your mortgage goes down every month and your payment stays the same. Get private life insurance. Much better option, cheaper for more coverage

[@Via-Jay]

Hi Steve, I love your channel. Thank you for all the information you share with us. I would like to know your opinion about buying leasehold properties. Do you think it is a good idea for investment? Thanks!

[@SteveKarrasch]

NO!

[@Mr51seer]

thanks for the video. mine is only 5$/month but i'm only 26

[@Imsosmrt1999]

I’d say that is bad advice. Here’s why. Most people don’t have any insurance. When I was doing mortgages, I would tell people without life insurance this: “you don’t have any insurance right now. You’re about to go hundreds of thousands of $$ in debt. This is what you should do: take the crappy mtge insurance product, which starts immediately, keep it ONLY until you can get better coverage, and then cancel the (bank) mtge insurance”. What will they be out, $100? $200? To my mind getting immediate coverage is the better decision. People die. I’ve seen it happen. A family member, too. Lousy insurance is better than none. The reality is most people left saying “oh don’t worry, I’ll get insurance from ‘my guy’” and never do it. It’s human nature. Nobody likes to think about death. I never regretted selling it.

[@GG-os4is]

You make a good point. This video/your comment made me think about my insurance situation. I have 100k min. life Insurance through work (I'm a government employee). I said no to the added 400k coverage. Now I'm thinking fawk it, maybe I should fork out the extra monthly payment for the added coverage. I'm in my mid-30s now and still have north of 400k in mortgage left.

[@Imsosmrt1999]

@@GG-os4is it kinda depends on your situation of course. If you have a spouse, kids, a mortgage, it’s a no brainer. There comes a time when insurance may be optional, but in peak earning/high debt years a simple term insurance policy can alleviate a lot of heartache. And for what? The cost of a couple of meals out a month. That’s a pretty good trade-off to my mind. With regards to the mortgage life insurance, you also get “free” time to review the policy (typically) so if you got a better deal you can usually cancel the MLI and get a refund. So it’s kind of a no-downside choice if you have no other insurance. Good luck!

[@m.b5777]

Vast majority of people believe that if something happens to them in terms of critical illness, the insurance will pay off their entire mortgage 😂

[@Mr51seer]

not gonna lie, that's what i believed lol

[@ludwigvonbear8548]

Most creditor Critical illness do pay balance. Scotiabank has a promo case study video of this that’s easy to find. Disability makes payments until you’re better from injury/illness (non critical) with a 24 month limitation being common... CI is fir cancer, heart attack, stroke and illness like that.