|
| |
|
|
Mortgage Life Insurance is an insurance that loan owner purchase when buying a property. It is designed to settle the outstanding loan balance in the event that the borrower dies or suffers from total and permanent disability (TPD) prior of settling the loan.
Basically there are two types of mortgage life insurance that are available in the market. There are Mortgage Reducing Term Assurance (MRTA) or Mortgage Decreasing Term Assurance (MDTA) and Mortgage Level Term Assurance (MLTA).
The table below shows the different between MRTA/MDTA and MLTA
| MRTA | MLTA | |
|---|---|---|
| Purpose | Protection | Protection, Saving & Cash Value |
| Protection | Reducing Protection throughout the loan tenure. | Protection is leveled throughout the loan tenure. |
| Transferability | Non transferable on New Purchase or Refinance. Premium will increase while age increases. | Transferable. One MLTA can be attached to Any Loan. Transferable on New Purchase or Refinance. |
| Cash Value | Reducing Cash Value throughout the loan tenure. Normally is much lower than Premium, and drop to RM0 at the end of loan tenure. | Fixed Cash Value (Guaranteed) throughout the loan tenure. Policy Holder will get back the paid premium in the future. |
| Nomination | Beneficiary is bank | Beneficiary can be anyone. |
| Payment | Lump Sum Payment or financed into Mortgage Loan. | Payment Mode can be Annually, Semi Annually, Quarterly or Monthly. |
| Premium | Low | High |
| Example on premium* | One time RM5,931.7 | RM303.60 monthly or RM3,643.20 yearly or RM109,296 throughout the tenure |
| Example if there is no death or TPD* | At the end of tenure owner will received RM0 | At the end of tenure, owner will received RM109,296 |
| Example if there is death or TPD** | Insurance company will pay the loan balance of RM186k to the bank & beneficiary will received the home. | Insurance company will pay the loan balance of RM186k to the bank & beneficiary will received the home plus RM50k cash |
Note
* Example based on a loan owner at the age of 26 taking RM236k loan for 30 years
** Example based on loan remaining of RM186k
Related posts:
- Why Should I Choose Australian Lifebroker Insurance
- Term Loan vs Flexi Loan for Property Financing
- Banks Going on Price War by Offering Low Mortgage Rate
- How Much is the New Motor Insurance Premium?
- Deposit Insurance Limit Increase to RM250,000
- MortgageKLIBOR Home Financing From Standard Chartered
- Home Loan Comparison Between Banks in Malaysia
- Malaysia Deposit Insurance Corporation (PIDM)
- AHB Financing-i, Loan to Invest in Amanah Hartanah Bumiputera
- Travel Insurance Direct New Zealand
{ 14 comments… read them below or add one }
Question – is there an age limit for MRTA; I understand that elderly borrowers (above 65yrs) cannot purchase MRTA. Is this true?
Hi,
Assume bank willing to lend to those of age 65.
Age 65
Term 10 years
Loan RM200k
Premium RM32,514 (Non-financed)
RM38,825 (Financed)
Chong Kong Hui
[email protected]
HLA Agent
Hi,
I would like to fine out with you about home loan insurance. I am buying a house soon but i am hiv+ so it is i cannot buy any homeloan insurance or what type of homeloan insurance are suitable for me to buy? kindly reply…
Regards
kj
Please contact me via email.
[email protected]
i will buy house soon. N now compare both insurance. dun knw which 1 is better.. can you advise? let say if i want to buy the MLTA, loan amount is 130k, 29 yrs old.. how much is the fees need to pay for that insurance?
Thanks
There is more than a product that can serve MLTA concept for mortgage protection.
Check for details and get a plan that fits your financial position (an accounting new term for Balance Sheet).
MRTA is a life insurance.
Investment link policy is a life insurance.
MLTA also is a life insurance.
PA also is a life insurance.
Hi,
I will buy a house soon, my 90% loan : RM 276,126.30 Im interested on taking MLTA instead of MRTA proposed by the bank. Can u consult? about what is the cost to pay? is it shariah compliance? TQ in advance.
aisyah,
You can look for takaful based MLTA for shariah compliance such as PRUBSN Takafulink. For the premium, best if you contact insurance agent as the calculation is also based on your age and few other things.
Hi.
Just wondering whether it’ll benefit us if we opt for Investment link for MRTA from Great Eastern instead of taking the MRTA from bank? My friend were saying its cheaper & serve the same purpose.
salam aisyah
if u like to know more about MLTA from prubsn, pls email me at [email protected].
drop ur number than i’ll happy to give u free consultation.
Nahar
I’m Vanessa kong from ING. If you have any question for comparision MRTA and MLTA the different. Pls email me as:[email protected] or call my mobile: 0122932823.
Thanks
Regards
Vanessa Kong
i already took home with mrta, can i can cel and change to mlta
Actually you can cancel it, by getting back part of your premium.
If you need more information, can contact me thru [email protected].