A cheap mortgage payment insurance policy can give peace of mind
- 3RD NOVEMBER 2007
If you want peace of mind that you would have the money each month to carry on paying your monthly mortgage repayments in case you should find yourself unable to work after suffering an illness, having an accident or becoming unemployed due to no fault of your own, then you should consider taking out a cheap mortgage payment insurance policy.
A cheap mortgage payment insurance policy can provide you with an income so that you have the money for your mortgage repayments along with associated payments such as insurance, this gives great peace of mind that you wouldn’t risk getting into arrears with your mortgage and so lose your home due to repossession. Sadly the state doesn’t give enough help if you find yourself out of work that’s of course even providing you would be eligible to claim from them, which means that you have to put your future in your own hands and have a back up plan on which to fall back.
Mortgage insurance policies begin to payout after you have been out of work for a pre-determined length of time which can be between 31 and 90 days of being out of work, the money you would get is tax free and would then continue for between 12 and 24 months depending on providers. A quality policy from British Insurance would begin to pay out from day 31 and for up to 12 months and along with getting a quality product they can back this up with years of experience in the payment protection sector which means you get the advice needed to determine if the product is what you need.
Mortgage payment protection isn’t suitable for all circumstances and you have to check out the small print in all policies along with getting quotes for the cheapest premiums. If you are self-employed, have a pre-existing medical condition, work for yourself or of retirement age then a policy wouldn’t be suitable for you circumstances. There can be other exclusions so you have to read the small print and any ethical provider will make these available to you before you purchase the cover, buying mortgage cover alongside the mortgage from the high street lender will leave you paying too much in premiums and being given little if any advice.
British Insurance can save up to 40% on a cheap mortgage payment insurance policy but the product can only protect your mortgage and give you peace of mind if you are aware of the small print and exclusions that are in all policies. Depending on where you choose to take out the cover will all depend on the amount of information you are given regarding the product, the high street lender will offer mortgage payment protection alongside the loan but often has poor selling techniques when compared with an ethical provider such as British Insurance.
In 2005 an investigation began into the payment protection sector of which mortgage payment protection is one product, it was found that mis-selling of the cover was wide spread with the majority of the culprits being the high street lenders who had failed to give the consumer the essential advice needed or to make them aware the cover could be bought independently. The sector is still under the watchful eye of the Financial Services Authority and also the Competition Commission who are conducting an in depth review of the sector which is expected to reach conclusion in February 2009.
Despite warnings from the Financial Services Authority that selling techniques have to improve over the last few months there have been reports that mis-selling has trebled and firms still aren’t making mortgage cover transparent and consumers aware of their options. If you want peace of mind and security then it is essential that you take the advice of a specialist standalone provider and make sure you read the small print and are fully informed before buying a cheap mortgage payment insurance policy.
