subject: Personal Loan Insurance - Three Types You Need to Look at [print this page] Personal Loan Insurance - Three Types You Need to Look at
Loans serve several purposes such as debt consolidation, sponsoring college course, car repair. Since the lender would have to be provided with collateral to ensure repayment of the loan, getting secured loans is much riskier. This is because lender would easily become the legal owner of real estate, cars or whatever properties that stands as collateral if repayment terms cannot be met due to loss of job, death or medical incapability.On the other hand, if handled with good money management skills, loans do help improve bad financial situations. Since certain future circumstances cannot be seen or controlled, it is important to consider insurance.
Personal loan insurance gives the best protection for meeting the repayment terms when the outlined repayment plan fails along the way. The cost of insurance varies and is generally determined by the percentage of the total amount collected that is yet to be paid. The type of insurance coverage also determines the insurance premium but it provides more assurance for meeting the repayment terms with peace of mind for borrowers with secured loan option.There are three basic types of personal loan insurance coverage that can be chosen from. The specific dollar amounts of coverage will depend on the laws in your State and the dollar amount of your loan. Therefore, discussing with any lender being considered is very important.
The personal loan death insurance pays up to a certain dollar amount in the event that one of the individuals on the loan dies. If only one person is on loan and he dies along the line, then the loan balance will be paid in full up to the maximum dollar amount irrespective of the amount collected as loan.
Disability Plus personal loan coverage pays up your monthly dues up to a certain dollar amount and so, it is the most embraced personal loan insurance protection. It also ensures that you are paid a certain amount of your loan amount each month so as to meet with the cost of living expenses.
Involuntary Unemployment Coverage Insurance for personal loans will pay up to a certain dollar amount per month in personal loan payments for up to a set amount of months.
Insurance can help a great deal, especially for individuals whose loans are secured as it ensures your payments will be made when medical issues, unemployment, or even death arises. If a secured personal loan is not insured, valuable assets that are tied down as collateral would be lost and their credit score will be negatively impacted.It is very important to inquire about insurance when seeking for loan. Discussing with lenders will be beneficial to both of you as it further assures them they will receive the funds
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