It is tempting to sit back and relax once you have moved into your new house – but hang on, have you made sure that you’ll be insured against all the hazards that might prevent you from meeting your home loans bank repayment schedule? A lot of things could go wrong and make it not possible for you to work so that you will possess the earnings to satisfy your monthly bond payments and living costs. Moreover, interest rates on mortgages could increase to the degree that you will not be able to afford the repayments. Should you be responsible for family members, then it is especially important that you take heed of the subsequent factors:

Soaring interest rates

What happens if rates of interest rise and you can no longer afford your monthly repayment demands? It is possible to fix the interest rate of your bond for a predetermined period of time so that you pay the identical interest rate each month regardless of Reserve Bank interest rate fluctuations. Having said that, if the rate of interest on home loans bank repayments goes down while your bond is on a fixed rate of interest then you will continue to pay that rate however you will benefit because you will be paying in additional each month over and above the interest rate.

Employment retrenchment

What if you’re made redundant? It is possible to claim from the Unemployment Insurance Fund for a specific time once you’ve out of work however the sum you will get will be a portion of your previous salary and is usually insufficient for a family to live on, much less pay the bond. Consequently, you might not be able to maintain your home loans bank repayment plan and risk getting your house taken back by the bank. It is therefore possible to insure your income against the possibility of being let go later on by taking out salary protection coverage through an insurance firm.

Illness and disability

The insurance sector estimates that 1/5 of males and 1/6 of women have to completely abandon work before retirement age due to a serious illness or injury. Consider this, should you have a heart attack at the age of 45 then you are unlikely to return to work once more. Together with a family to support and a home loans bank repayment schedule to meet, this could be disastrous. It’s possible to acquire disability cover for a comparatively modest monthly fee which will pay out a sum of money should you be unfit for work. The earlier in your life you take out this kind of insurance policy the better, and you should start paying in while you’re still young and healthy.

Premature death

Suppose you die while you are still young and before retirement, leaving your loved ones to cope with an unpaid mortgage? You can obtain life cover that’s relatively inexpensive and will pay up a lump sum upon death. Like disability insurance, life cover must be taken out early in life, enabling as many potential years of premium payments as possible.

Perhaps you have realized from the preceding points your capacity to meet your home loans repayment schedule has a great deal to do with your extended good health. Thankfully, there is an insurance plan to take care of nearly every eventuality several of them are relatively cheap as long as you shop around. In any case, the amount you pay for this protection is worth every cent for the peace of mind it will give you.

For more information about home loans bank repayments visit the website http://www.isureins.co.za