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Don’t Get Suckered Into Mortgage Protection Insurance


Did you know that one of the biggest investments most people ever make is in their house? Most properties are worth more than $100,000, which might be more than 3 times the amount that you earn in a single year! Since pretty much nobody has $100,000 sitting around to buy a house with, most of the time the bank gets involved. And, with a $100,000 loan comes a little bit of nervousness. What if something happens and you’re not able to pay off your house? Isn’t there some kind of insurance that can cover you? Well, yes there is, but I certainly wouldn’t advise it.

My Letter

I recently received a letter in the mail regarding mortgage insurance, and I thought that it would make an excellent post. First of all though, let’s take a look at this letter:

In the event that I pass away, this Mortgage Property Insurance would pay off my mortgage, but I believe that this is a bad deal for multiple reasons:

Why Mortgage Protection Insurance is a Raw Deal

1) Your House Could Be Paid Off With Your Term Life Insurance – If you have Term Life (which probably only costs $10 a month or less), you could be covered for $250,000+. Your spouse could then decide whether paying off the house is important and then have tons of money to spare.

2) Your Mortgage is Continually Being Paid Down – This letter makes you think that it’s a big deal that the monthly payment will never go up. Well duh! It never should because your mortgage is always going down every month. If you pass away and your house still isn’t paid off, chances are that your house is already paid off and the insurance company is the big winner.

Make Sure You Pass on Mortgage Protection Insurance

If you ever get a letter like I just did about MPI, make sure to just tear it up and put it into the trash. You don’t need it, especially if you are working hard at getting rid of your debts. Within the next 5 years, you won’t have that mortgage to worry about anyway.

Have you ever had a letter like this come in the mail? Did you just ignore it?

Mortgage Payoff


My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.


  1. Yes I have had letters like this. What did you do? Contact them and tell them it’s a scam. I do that from time to time. 🙂

    • Haha. I have never gone as far as contacting them. That’s a new one. 🙂

  2. I got one after closing. Lots of companies will send you mail trying to sell you thinks that you don’t meed relating to your new house. Inspect the mail carefully to find out who it IA from and if it isn’t from someone you have recently done business with chances are it is not something you need and is likely a horrible deal!

    • I won’t ever be needing mortgage portection insurance. I have term life which will more than pay for our house if I pass away.

  3. I have never really thought about it and If I haven’t to drop by here then probably I have taken their offer! lol Now I know what to do and make some compost out of it!

    • Haha. Yeah, it’s better to use it for compost, especially if you have other insurance that will take care of your mortgage expense.

  4. It is term life insurance, it’s just marketed as mortgage protection. Your beneficiary can use the money anyway they choose. Not a scam.

    • The scam is that it’s crazy expensive. Just go with term insurance if that’s what you want.

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