Archive for the ‘Mortgage Cover UK’

Modern life is full of little safety nets, from the air bag on your car to the pin number required to use your credit card. Some of the little measures which we take for granted can help guard against disasters which would otherwise complicate and disrupt our lives. In this sense it is practical to take precautions where necessary, and some people look to protect their ability to keep up with debts. With a good credit rating now important if someone wants to borrow money in future, the option to protect the ability to pay that money is becoming more and more popular. Some people even protect their home loans with mortgage cover UK policies.

This type of policy is designed to protect against the unpleasant but possible scenario of someone losing their income through no fault of their own through illness, an injury suffered in an accident, or involuntary redundancy. No one can predict when ill health will strike, and some illnesses mean that people end up being off work for months or even years. In such circumstances basic sick pay schemes may not run the distance and leave someone high and dry in the longer term before they are fit and back at work. Job security comes into greater question in times of more economic uncertainty, and this leads people to wonder if their employer may one day no longer need their services.

To take out a mortgage cover UK policy, someone will need to be aged between 18 and 65, and will need to have held down a full-time job for a set period of about six months. They will also need to be an official UK resident. Provided they meet these basic requirements, most people will qualify and be able to insure part of the cash they have to shell out each month on meeting a homeloan and its associated costs.

Following a successful claim, payments normally kick in a month after the initial application, and some companies will backdate their payments to the day someone lost their income. Cash simply arrives on a monthly basis while someone is without their job and arrives in their account tax free. The money can be used to keep up with the regular repayments, the interest, council tax bills, utility payments, and even groceries. About 50 per cent of what someone would normally spend on these things is paid out each month on a basic policy, and greater amounts can be insured for a higher premium.

There are some helpful extras commonly available, such as carer cover for anyone who is concerned they might one day have to leave their job to look after someone in a full-time capacity. Most insurers are flexible and will provide cover which only guards against redundancy or only guards against health related problems.

Simon Burgess is managing director of protection specialists British Insurance. This is an independent insurance company which strives to offer better deals than high street insurers and lenders. He says: “A mortgage cover UK policy might sound like one more extra expense, but it takes on extra significance in times of financial uncertainty and can provide an absolutely vital safety net in certain circumstances.”

Some quite alarming research carried out in the first half of 2008 revealed the extent of the financial disaster facing over a half of the working population if they were to lose their jobs and remained out of work for longer than four months. After the financial melt-down in October and the acknowledged beginning of an economy-wide recession, this situation can only have worsened, with that same proportion of the population finding it impossible to maintain their mortgage repayments and therefore facing the prospect of losing their homes. This amounts to a real mortgage cover UK crisis.

Research findings published in the Daily Mail on the 26th of May 2008 estimated that the rising cost of living had made saving become so difficult that one in four of employed people had no savings at all and only half had enough savings to carry them through more than four months of unemployment (the average time taken to secure alternative work after having been made redundant).

With insufficient savings – or none at all – to fall back on, this would leave at least 14 million of the country’s 29 million workforce with nothing to pay the bills. For the high proportion of homeowners amongst them, this means nothing with which to cover the mortgage repayments and, so, the very real risk of having their homes repossessed. Even those with sufficient savings, of course, would soon find their nest-eggs rapidly dwindling in the event of unemployment – they would equally quickly discover that savings take a long time to build up, but hardly any time at all to deplete.

The mortgage cover UK crisis has developed, it seems, because so few people are aware that protecting a mortgage against the ravages of unemployment is in fact so easy and straight forward – not to mention affordable, as well.

Mortgage payment protection insurance can typically cover up to 75% of the policy holder’s monthly repayments, or a total sum of £3,000, whichever is less, and depending on the particular policy chosen. In the event of involuntary unemployment, the insurance then pays out generally for a period of 12 months (or even 24 months) – considerably longer, in other words, than the four months which is needed by the average employee to secure another job.

In the words of Simon Burgess, managing director of one of the country’s leading independent insurance providers, British Insurance: “the mortgage cover UK crisis has exposed just how vulnerable many people are to the increasing risk of unemployment during these bleak economic times. Mortgage payment protection insurance is easy to arrange, eminently affordable and, above all, will offer a reliable safeguard for the mortgage in the event of redundancy”.

A mortgage cover UK policy can be taken out independently of the mortgage although lenders will try to get you to take on a policy at the time of borrowing and fail to mention that you can choose to shop around for the cover. You would take out the insurance by protecting up to a certain amount of the mortgage repayment you make each month against the possibility of falling ill, suffering an accident or becoming involuntarily unemployed. The amount you choose to protect would be the sum you received back if you were to suffer from one of these events.

The money that you received from your mortgage cover UK policy would be used towards maintaining your mortgage repayments which would ensure that you would not fall into arrears with them. It is imperative to stop yourself from falling behind on the repayments as this can lead to the lender taking repossession of your home through the courts. If this were to happen you could have to leave your home after being given an eviction order. With the protection you would at least have security of an income for the period defined by the lender which would differ with providers.

If you choose to take a policy with standalone payment protection specialist British Insurance you would have an income that would payout after day 30 of unemployment or from being unable to work. The cover is dated back to the first day of you suffering accident, sickness or unemployment and once claimed on it would provide you with money each month for as long as 12-24 months subject to which policy you choose. Should you choose to search with other providers you need to check the small print as some will ask that you remain unemployed or incapacitated for at least 90 days before you make a claim. The terms of the cover should also be checked to find out how long you would benefit from the protection as some providers will continue paying an income for up to 12 months only. When checking the terms take a look at the exclusions as these differ with providers also with some adding in many. Ethical British Insurance add in just the basic few and they provide you with the information you need to ensure suitability.

A mortgage cover UK policy can give you enormous peace of mind that you would have an income coming in each month. This will allow you to make a recovery from accident or illness, it would also give you the time needed to search around and find work again. If you were to risk turning to claiming from the State you could be let down. You would have to be eligible to claim and if you were you would only get an income towards the interest part of your mortgage repayment and currently you would have to wait for many months before you would receive any income.

With everything from the cost of monthly mortgage repayments to the price of fruit and vegetables increasing so steeply, it might seem to be the worst possible time to take on yet another monthly expense in the form of one more insurance premium to pay. Yet for the very reasons that money is becoming so tight, the mortgage is one financial commitment that should really not be left unprotected. Fortunately, therefore, it is welcome news that there are a number of mortgage cover UK options.

In the words of one of the country’s leading providers of mortgage payment protection insurance, Simon Burgess of British Insurance: “Every homeowner’s budget seems so tight these days that any notion of putting away savings for a potential rainy day is pretty remote. As a result, even a temporary interruption to a regular source of income can spell financial disaster, an inability to keep up with the mortgage payments, and ultimately the repossession of a mortgaged home. Some form of mortgage cover, therefore, makes probably greater sense right now than it ever has done”.

It makes sense not only because the stakes are so high – what is a bigger financial nightmare than losing your home, after all – but also because there is a range of mortgage cover UK options to suit practically any circumstance.

For example, if the cost of the monthly premiums really is an issue, then it is still possible to buy very basic protection for the mortgage in the event of your being incapacitated from working because of an accident or ill-health. With this level of cover, you will have the security and peace of mind in knowing that even if such a temporary incapacity prevents you from working and earning a regular income for up to 12 months, the mortgage will still be paid. And if 12 months seems too brief a period to cover the incapacity that might strike, then it is even possible to extend the period during which the insurance would continue to pay out for up to 24 months – although, of course, the premiums for such extended cover will also cost more.

Alternatively, if you are in the peak of good health, are fortunate enough to belong to your employer’s accident and sickness income insurance scheme, or are generally more worried about the risk of becoming involuntarily unemployed rather than incapacitated, then mortgage cover limited to the risk of unemployment might be your choice.

Whether it is insurance against the risk of incapacity, unemployment, or all three (as a combined accident, sickness and unemployment policy), it is almost certain that there are suitable mortgage cover UK options to suit any homeowner.

Anyone over the age of 18 but under the age of around 65 can usually take extra steps to protect the safety of their mortgage, subject to certain conditions. People seek out mortgage cover UK insurance for a wide for a variety of reasons, be it concerns over how they would keep up with repayments should they fall ill, have an accident, or be told they are being made redundant. Anyone who has a home loan in place will be well aware of the potential risks involved - failure to keep up with repayments can lead to repossession, as the home loan itself is secured against the property - in this sense a mortgage is actually a kind of secured loan.

The basic process of getting hold of this type of cover is quite straightforward. An applicant will normally have to have held down some form of employment for a set period, usually around six months, to qualify. There is, however, no set requirement on how much they earn or how they earn it.

A policy will pay a lump sum each month towards the cost of the mortgage while the policyholder tries to find more work or battles to recover from an injury or illness. This benefit will be paid for typically 12 months, though some policies offer cover for up to 24 months, so do check out the terms and conditions. All that the insurer requires to provide this safety net is a regular premium, paid in one sum or by the month.

Mortgage cover UK insurance is part of the payment protection insurance industry - a sector which has attracted some negative attention over the last year or so. This began after some firms were accused of selling this type of insurance to people who did not need it or even through unethical means. The Office of Fair Trading (OFT) appointed the Competition Commission to investigate the industry as a result of this, the full results of which will not be published until 2009.

However, this does not mean people thinking of becoming mortgage cover UK policyholders should disregard cover - more independent firms such as the ethical British Insurance specialise in matching the right deal to the right customer, and can in some cases save people thousands of pounds on their insurance. This means protecting a home in the event a key bread winner becomes ill, is hurt or made redundant need not cost the earth. With some premiums only mounting up to a few pounds per £100 worth of cover, shopping around less ‘high street’ type companies could pay off in the long run.

A mortgage cover UK policy could help you to save your home if you became a victim of redundancy or were to be unable to work after suffering from an illness or an accident. You could insure a portion of your monthly mortgage repayment against becoming a victim of these events, which would be pre-agreed at the time of taking on the policy. This sum of money would then be paid back to you as a tax-free income if you should need to make a claim on the policy and would go towards you being able to maintain the mortgage repayments.

The cost of a mortgage cover UK policy would depend on where you chose to take out the protection. If you were to take the cover that is offered by the mortgage lender then you would be paying over the odds for the protection. You could save up to 40% on the cost of a policy if you choose to take it with independent payment protection specialists British Insurance. Along with making great savings on the protection you can get cover that is sold by well trained staff and which comes with few exclusions. You would have to check the exclusions against your circumstances in order to be sure that you would be able to claim before taking out the protection but British Insurance make this information available on their website.

Mortgage payment protection from British Insurance would payout from day 30 of you being unemployed or incapacitated and it would be dated back to the first day you became redundant or from when you became unable to work. From claiming you would have 12 months cover on which rely and then it would expire. If you compare the cost of a policy with other providers you might be able to get a policy that would run for 24 months. You would also have to check to find out when the protection would begin as some providers state a deferment period of as long as 90 days.

A mortgage cover UK policy could go a long way towards you keeping out of mortgage arrears. If you were to get into arrears with your mortgage the lender could choose to repossess if you cannot reach an agreement to pay back what you owe while also being able to maintain your regular instalments. A policy would provide you with comfort as throughout its duration you would have an income and this would allow you to be able to concentrate on finding work or making a recovery.

A mortgage cover UK policy could make the difference between losing the roof over your head and keeping it if you lost your income. You might lose your monthly income after falling sick or suffering an illness that meant you were unable to work or you could lose it to being made redundant. In all of these cases you could pay a small premium with an independent provider and not have to worry for the term of the policy.

You would be able to take out a mortgage cover Uk policy with an independent payment protection provider by insuring a portion of your mortgage repayment which is pre-agreed at the time of taking the cover. This would be the sum that you would be given back if you fell sick, suffered an accident or were made redundant and it would allow you great peace of mind.
It is essential to maintain your mortgage repayments as the results of mortgage arrears can lead to repossession by the lender. Usually a mortgage lender will allow you to come to an agreement to catch up on the money you owe within a certain amount of time. However if you have not got a regular income coming into the home this would not be possible. At least with a mortgage cover policy you would have an income for a certain length of time which is defined by the provider and which must be checked when you take out the cover.

Ethical payment protection specialist British Insurance would provide you with your income once you have been incapacitated or unemployed for at least 30 consecutive days. They would then back pay on the benefit to day one of your incapacity or unemployment and you would receive an income for up to 12 months. Checking the terms of the cover is essential if you are looking around with other providers as some might offer 24 months’ of protection. You would also need to check to see when the policy would begin to pay out as some ask that you defer from claiming up until at least 90 days.

You would also have to check the small print to see what exclusions reside in the mortgage cover UK policy. All providers will add in some exclusions and these would need checking against your personal circumstances as they could mean you would be unable to make a claim. British Insurance provides you with these exclusions on their website so you are able to determine the suitability of cover before you take it out.

Have you considered what would happen if you were to lose your income due to accident, sickness or redundancy? A mortgage cover UK policy could help you to save your home from repossession by providing you with an income that would go a long way towards you being able to maintain your repayments and so not fall into mortgage arrears. If you were to fall behind on your repayments and not be able to catch up then the lender could take steps towards taking you to court and having you evicted from your home.

You could take out a mortgage cover UK policy by insuring up to a certain amount of your mortgage repayment and then claiming this back as a tax-free sum if you lost your income. You would be able to insure your mortgage repayments against the possibility of unemployment which was caused by no fault of your own and you could choose to cover incapacity too.

When you would begin to receive an income after falling ill, suffering an accident or becoming unemployed would depend on the provider. If you had taken your insurance with British Insurance this would be from the 30th day and cover would be dated back to day one of you becoming unemployed or incapacitated. The policy would then pay out for a period of 12 months if you had to claim for that long and then it would just expire. You would have to look at the terms and conditions with other providers because some might offer to payout for up to 24 months. You would also find out when you would be able to put in your claim as some providers might state you have to be unemployed or incapacitated for at least 90 days before putting in your first claim.

A mortgage cover UK policy can work as a safety net on which to fall if you were to lose your income but only if you are aware that there are exclusions and these have to be checked against your circumstances. An ethical provider such as British Insurance would make you aware of these and provide the information needed for you to ensure suitability on their website. Once you have done so then it would be a more reliable way of having something on which to fall than relying on savings to get you by. As you would not know how long you might be unemployed, savings might not last, as least with cover you would have the specified time knowing that your repayments were safe.

A mortgage cover UK policy would be able to go a long way towards helping you keep out of mortgage arrears if you became unable to work due to involuntary redundancy or incapacity. You would be able to insure a portion of the repayment you make each month and this would then be supplied to you as a tax-free income if you became unable to work after suffering an accident or an illness or where you became unemployed.

There are three levels of protection that you can typically choose from. You could take out a mortgage cover UK policy against the possibility of accident, sickness and unemployment together. You can also choose to cover unemployment only or incapacity only. This, and your age and the amount of protection you wanted, would go towards determining how much you would have to pay for premiums. If you choose to take a protection policy from standalone payment protection provider British Insurance you could save up to as much as 40% on the cost of insurance. Along with this age based protection is ideal for the younger generation who often have huge mortgages and who previously could not afford to take out the expensive protection offered by lenders at the time of taking out the mortgage.

There are exclusions that would need checking before you take out the protection such as being in part time employment or being of retirement age. These need checking against your lifestyle if you want to ensure that you would be eligible to claim against the protection. British Insurance would supply this information on their website which makes checking easy and quick. Once you have checked for eligibility you would then have a back up plan on which to fall back if and when you needed to put in a claim.

A mortgage cover policy provided by standalone provider British Insurance would provide you with a much needed income once you had been unemployed or incapacitated for a period of at least 30 days. Once you had made a claim on the cover it would be back paid to day one of you first becoming unemployed or from being unable to work and it would then continue for 12 months. If you shop around you might be able to secure yourself cover that would continue paying out for up to 24 months and some providers might state that you would have to be unemployed or unable to work for at least 90 days.

Mortgage cover UK policies would go a long way to keeping you out of arrears with the mortgage. If you were to get into arrears with just one missed payment the lender would want to know when you would be able to catch up on the missed payment. More missed payments and you would be expected to make an agreement with the lender. As you have not got an income coming into the home and do not know when you would find work or be able to go back to work they could start proceedings to take your home and have you evicted.

You are able to get  mortgage cover UK policies a lot cheaper online than you can if you take the protection that is offered by the lender on the high street. High street lenders charge way over the odds for the protection and in some cases cover has even been added onto the mortgage without the consumer realising that it has been included. If you do take out a mortgage then always check to make sure that protection has not been added into the cost of the mortgage.

You can take out mortgage payment protection for a fixed sum of money each month that depends on the level of protection you want, the amount you want to cover and how old you are when you take out the protection. By insuring up to a certain amount of your mortgage repayment you then get this sum of money back if you were to become unemployed as the result of an accident, sickness or unemployment. This money would go towards you being able to meet the repayments of the mortgage and so ensure that you do not fall into arrears. Mortgage arrears that cannot be paid back through making an agreement with the lender can result in the lender taking you to court. If this happens then you could lose your home.

Depending on your circumstances you could choose mortgage cover UK policies for accident sickness and unemployment, unemployment only, or incapacity only. As British Insurance offer age based protection this means that even the younger generation whose budgets have been stretched to the limit can now afford to take out valuable protection for their mortgage. Younger first time homebuyers often push their outgoings to the limit and this previously meant that the expensive protection taken with the lenders on the high street was unaffordable.

Ethical payment protection provider British Insurance would begin to payout on the policy from the 30th day of you becoming unemployed or incapacitated and they would also back pay on the policy to the first day of you being made unemployed or of being incapacitated. Following a claim on the protection you would then have 12 months in which to find work or to make a recovery and get back to your own job. You could find some would payout an income for up to the 24th month and others might ask that you wait as much as the 90th day before you are able to put in claim.

Mortgage cover UK policies do have to be checked before taking them out as there are exclusions that you need to look into. With British Insurance there are just the most frequently found ones but some lenders could add in many more.