What is MRTA? | Mortgage Reducing Term Assurance

In events of permanent disability or death, you need not to worry about your mortgage much more. MRTA will help you cover your outstanding home loan amount. Find out more.

MRTA is defined as a term insurance that helps cover the outstanding amount of home loan provided by a financial institution in events of permanent disability or death of a particular borrower. Before proceeding, keep in mind that MRTA is normally calculated to meet the outstanding loan amount. (read about How MRTA can benefit you)

MRTA should not to be confused with another famously known term which is MDTA, Mortgage Decreasing Term Assurance. Certain financial institutions will allow you to finance and add premium to your home loan.

Check your MRTA Premium here FIRST.

Lately, new property buyers have been constantly offered MRTA – A certain something someone should have. Be always aware that there are times when you need to be careful about life – You do not know what will happen tomorrow. But are these MRTA Premiums worth paying and can you cover the costs? Before proceeding further, you should read on Personal Financing Tips first. Topics include:

1. Avoiding Simple Banking Fees

2. 9 tips to cheaper cinema outings

3. Are you being dumb with your money?

4. Why am I always broke?

5. Emotional Onslaught when you hit 56?

6. Managing your Finances

7. Personal Budget Calculations

Pricing Elements for Single Premium Payment

Certain MRTA policies will charge by Single Premium Payment or Annual Premium Payment, depending on which policy chosen. For annual premium payment, payments are calculated based on the total insurance price and tenure will be usually 2/3 of the insurance term.

Among elements in MRTA are:

1. Interest Rate
2. Policy Fee
3. Premium Payment: Single or Annual
4. Rate per 1000 sum insured
5. Coverage Ratio (%)
6. Age
7. Loan Amount
8. Loan Tenure
9. Health Status

What do you need to know when you apply for MRTA?

  1. Fill in all the blanks in the application form. Never ignore any questions. Should you have any doubts, consult your legal practitioner or banking institution officer.
  2. DO NOT falsify information. Such practices can lead to void of loan and legal action taken. (see Malaysia Home Loan Frauds)
  3. Fill in the blanks with full answers, straight to the point. Not with ticks, dashes, or any other punctuation/shortcut methods.
  4. Make sure your loan amount is right. Under-insure and you might be penalized in events of claims.
  5. Never sign blank forms.
  6. Always carefully and thoroughly read terms and conditions, risks and facts before you sign any form or provide any personal data.
  7. Disclose material facts appropriately.
  8. Complete and sign the form yourself. You can have your legal practitioner present when you’re writing the form.

What to do in events of MRTA claims?

  1. Do not get third party involvement in your insurance. (liability involvement, payment or negotiation)
  2. Notify the police immediately.
  3. Never claim that the insurance company will know of your disability.
  4. According to the terms, inflating the claim that it will be systematically reduced might cause your insurance to be forfeited.
  5. Ensure the safety of your property – At least make that effort rather than watching it tumble down.
  6. Complete the Loss Notification Form and submit immediately, when available.
  7. Inspection may be done, so keep your damaged items intact.
  8. Cooperate with your MRTA loan officer in terms of writing, loan adjusting, inspection and claims. You can have a legal practitioner oversee your actions.

>> Read more about How MRTA can benefit you.

The mortgage and financial consulting services are offered to you FREE of charge without any obligations. Kindly contact us or email to consultant@malaysialoan.com.my if you need any enquiry. Thank You.

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Malaysia Loan

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