The first thing to remember when you seek to buy a home with the help of a Home Loan is that a monthly repayment cycle will start, and will continue will the end of the tenure. There is a heavy price to pay if you miss even one installment,
But, what happens in case of an emergency, when the person on whose income you were thinking of repaying the loan loses the job, or has to quit to due medical emergencies? This is where the role of Home Loan Insurance comes into play.
Also Read: Best Strategies For Home Loan Repayment?
A basic outlook on Home Loan Insurance
It is like any other insurance plan where you have to pay a premium to get your risks covered. The insurance company will take care of the remaining amount of the loan in case of your inability to payback the Home Loan.
Home Loan Insurance employs the reducing cover concept. Explaining it further, suppose you avail a loan of X amount then you will get a coverage of X amount by your insurance company for the first year. In the next year your insurance company will pay the remaining money, say X-1.
There are certain factors which you must consider before applying for a Home Loan Insurance. To know more about it feel free to read on the link provided below:
Know More About Insurance Protection for Home Loans
Aman Khanna is an experienced financial advisor who is well known for his ability to foretell the market trends as well as for his financial astuteness. He has an MBA in finance from Toronto University as well as years of experience delivering seminars on sound financial practices and debt management.