Archive for the ‘Mortgage Payment Protection’

So, is mortgage payment protection insurance really as bad as the media makes out it is?

Mortgage payment protection insurance (MPPI) is usually offered by the high street lender at the time of taking out the borrowing, but, historically, taking protection this way if often the dearest option, with some £5 billion being raked in each year in profits from selling mortgage cover alongside borrowing.

Since the payment protection insurance mis-selling scandal came to light, where it was highlighted how many consumers had unwittingly bought protection insurance that was not suitable for them, or which they were ineligible to claim on, some improvements have been seen within the industry.

Many firms are making positive changes to the way that they sell payment protection insurance products such as loan cover and mortgage payment protection. The Financial Services Authority (FSA) have said that they will do everything in their power to improve the way protection insurance is sold.

The sector was referred for an in depth review to the Competition Commission and their final findings should be released in early 2009. However, they have already said they will ban policies being sold at the same time as taking out a loan, which allows consumers to fully investigate all their options and shop around for mortgage insurance that is right for them.

An independent provider can often offer cover at a cheaper price, often with added policy benefits. By going with a standalone provider such as the ethical British Insurance, for your mortgage payment protection, you can save around 40% on the cost, compared to those on the high street.

So, is it for you? While none of us like to be pessimistic, the truth is, none of us are infallible and at any moment in time, we could become unable to work and be without an income and that is why mortgage payment protection can be so valuable.
MPPI should seriously be considered as a financial safety net. With repossessions on the increase (the Daily Mail 21.11.08 reported that 130 families are losing their homes every day) and more first time buyers taking on huge mortgages, protecting the borrowing is essential.

It does not have to cost a lot as the premium charged for cover would typically be based on the level of cover needed, your age and how much your mortgage repayments are each month. With standalone providers can cost from just a few pounds a month for every hundred pounds’ worth of cover required.

Mortgage payment protection needs serious consideration. Homeowners’ relying on State benefits will be disappointed. And while your own personal savings could help over the short term, however, if you remained unemployed or ill they could soon be depleted.

House hunting can be an exciting experience. It can also be a potentially baffling one thanks to variations in prices due to location and the ups and downs of the housing market. Differing mortgage products make things more complicated and the array of different terms may leave some people in a spin. It is important not to get too wrapped up in the process and to realise the implications of taking on a mortgage, particularly if you’re a first time buyer. If someone loses their income and falls behind on repayments things can turn sour quickly, which is why some people opt for mortgage payment protection.

Although some people will not qualify for it or not need it, many people find it is a valuable safety net. If someone becomes unable to work because of illness, accident and injury, or involuntary redundancy, mortgage payment protection will help someone keep up with repayments until they are back on their feet. Policies will pay out for between 12 and 24 months or until someone is receiving an income again.

It is designed to bridge the gap between being out of work and having cash coming in again. Many people find that sick pay packages do not cover longer term illnesses well, while others do not have adequate savings and would struggle with repayments quickly if they did not have an income due to redundancy. Carer cover is another type of protection which will pay out if someone has to leave their job to become someone’s full-time career.

A mortgage payment protection policy will provide regular cash payments, the first of which will arrive between 30 and 90 days after the first claim, although some providers will backdate their payments to the first day someone was without their income.

Payments will normally be equivalent to a percentage of someone’s income up to a limit of about £3,000 and are designed not just for the repayments but any interest, council tax bills, and even utilities. Money will normally arrive in someone’s account tax free, in just the same way as their wages would have done if they were still working. In many cases the insurer will put no stipulation on what the money is actually spent on in detail.

Finding a policy can be daunting because of the range of companies which offer this type of insurance. Some mortgage providers actually offer their own cover attached to a home loan, and this may not be the best value. A borrower might be best to turn this cover down while taking out a mortgage and then shopping around a number of different providers. Some independent firms like protection specialists British Insurance can save people as much as 40 per cent on mortgage payment protection.

Mortgage payment protection insurance (MPPI) is a type of insurance that is taken to insure against the chance that you might lose your income as a result of becoming unemployed or if you should suffer an accident or an illness. In the case of any of these events you would be able to claim back the amount of your monthly mortgage repayment you chose to insure. This amount would be up to the limit defined by the provider and would be paid back as a tax free income.

The money received back from the policy would go towards you being able to maintain the repayments and would mean you would not have the worry of where to find the full repayment when the mortgage repayment became due. If you should fall into mortgage arrears the lender could offer you the chance of making an agreement with them to repay the arrears. However without an income you would not be able to make such an agreement and with no chance of catching up on the arrears they would have no alternative but to seek repossession of your home and have you evicted.

When the provider would payout and for how long they continue to payout would differ so you would have to check with them before taking on a policy. If you take a look at the mortgage payment protection that British Insurance provides you would find they would payout from the 30th day and you can choose between 12 or 24 months of protection. They would also date back your benefit to the first day of you being unemployed or from you being made redundant so there is no excess. The terms and conditions offered by other providers might state that you have to wait for up to 90 days before putting in your claim.

When checking the terms and conditions you need to find out what exclusions have been included in the protection policy. Ethical specialist provider British Insurance will add in just the most common exclusions and they supply the information that you need to check for suitability. Other providers could add in much more and these need checking against your lifestyle before you take out the protection so you can be sure protection is suitable.

Mortgage payment protection insurance is a better form of back up plan than risking being able to claim money from the State towards your mortgage repayments. To begin with you would have to prove you are eligible to claim benefits and even if you are the income you would get from the policy would only go towards paying the interest part of the mortgage repayments. You would also currently have to wait for many months before you would see any money. If you turn to savings as a means of maintaining the repayments you could also be let down.

Mortgage payment protection insurance can go a long way towards providing peace of mind. It allows you to protect up to a pre-defined amount of your mortgage repayment against the chance that you might lose your income as the result of an accident, sickness or unemployment. The amount you choose to protect would be the sum that you received back as a tax free income and would go towards you being able to continue meeting the demands of your mortgage.

Maintaining your mortgage repayment is imperative as falling behind on the repayments could lead to you losing your home. Mortgage lenders will usually do their best to allow you to catch up on missed payments while at the same time continuing to pay your regular monthly payments, however if you have not got an income this could be impossible. A failure to reach an agreement with the lender would see them taking you to court and seeking repossession of your home and you could be evicted. With protection behind you there would be no worry of this happening.

Mortgage payment protection is usually offered at the time of you taking on the mortgage with the lender. However you would pay over the odds for protection and taking it with a specialist payment protection provider independently you can save on the cost. Mortgage protection with leading payment protection provider British Insurance would cost up to 40% less and you can choose the type of insurance needed. You could insure against accident, sickness and unemployment together. However your circumstances might mean that you just want protection for unemployment only or for incapacity only and with British Insurance this is possible.

Mortgage payment protection taken with ethical specialist British Insurance could be claimed against from the 30th day of being made redundant or from being unable to work. You would then have 12 months in which to make a recovery from accident or illness or to find work if you have been made redundant. After this period of time your protection would cease. You could find that by shopping around with other payment protection specialists you might get protection that would continue providing you with an income for as long as 24 months but to find this out you would have to check the conditions of the policy. You also need to check these to find out when you can put in a claim and begin to receive an income as some providers will state you have to wait for up to 90 days. You also need to check the exclusions. British Insurance adds in just a few but other providers could add in more and these need checking against your lifestyle.

When looking around for a new home, particularly if you are a first time buyer, it is easy to get caught up in different types of homes, locations, and interest rates without fully considering the implications of what a mortgage entails. With the help of research and some expert advice, most people will not take on a home loan which they cannot manage. But a person’s circumstances can change quickly and unexpectedly, meaning some can be caught short and end up behind on the repayments. Mortgage payment protection is a type of insurance product designed to guard against the risk of repossession if someone were to suddenly lose their income and be unable to manage their home loan.

For the above reasons this type of protection cannot be ignored and is arguably as important as things like buildings and contents insurance. If the borrower becomes unable to work due to unforeseen redundancy, injury following an accident or a long-term illness, mortgage payment protection will step in to provide cash payouts to help with the monthly commitments which would otherwise be a major headache. Designed as a short-term gap filler, most policies will pay out for between 12 and 24 months, depending on the provider, or until the person or has recovered or found a new job.

The first benefit will normally arrive between 30 and 90 days after the initial claim, although this period will vary from one company to another and some will backdate the money. How much a person gets depends on what level of cover they choose and when they take out the policy. Most are not designed to cover 100 per cent of the mortgage payments and associated costs but rather a large portion which will normally start at around 50 per cent and go up to a limit, normally about £3,000. The cash can be used towards the cost of the home loan, buildings insurance, and even things like water and electricity bills.

It is important not to get confused when looking at different policies as there are a range of typical terms and names which all apply to the same thing. Mortgage protection is also known as mortgage payment protection insurance and MPPI, although all three are exactly the same thing.

This type of insurance is part of the payment protection insurance industry, which is still under investigation by the Competition Commission after some big name companies were accused of selling cover to people who did not need it or who did not qualify. Many people will have encountered mortgage cover after it was offered to them by the very same lender setting up their mortgage. This is known as selling ‘over the counter’, and does not always lead to the best value of cover. Instead, some people have been minded to turn to more independent specialists such as the ethical British Insurance, which can provide mortgage payment protection at far lower prices than high street banks and insurers.

Mortgage payment protection could be a lifeline towards keeping you out of mortgage arrears if you were to become unemployed or lose your income due to accident or sickness. You could insure a portion of your monthly mortgage repayment against the possibility of these events and if you fall victim to one of them claim the sum back tax-free each month for the duration of the policy.

The money you received from the policy would then be used towards you being able to maintain your mortgage repayments which would provide peace of mind while you searched for work or made a recovery. Keeping up with the repayments of the mortgage is imperative if you do not want the worry of losing your home and mortgage cover can help you to do this. You would have to wait for the period of time defined by the provider in their terms and conditions before putting in a claim and cover would then payout for a certain amount of time before expiring.

Standalone payment protection specialist British Insurance offers mortgage payment protection that comes with no excess as they backdate the payments to day one of your unemployment or from you being incapacitated. You can claim from day 30 and then continue to receive an income for up to 12 months if it took you that long to find work or make a recovery. If you chose to shop around with other providers you could find protection that would payout for up to 24 months but you would have to check the terms and conditions offered by the provider. You would also have to check when you would be able to make a claim as with some providers you might have to wait for up to 90 days.

Before taking out mortgage payment protection with any provider you would have to check for eligibility. There are always exclusions that have to be checked against your circumstances and if you choose British Insurance as your provider they give you the information needed on their website. They also add in just a few exclusions but other providers might add in many more. Once you have checked the exclusions you would then have something to rely on if you lost your income and it would be a better form of safety net than relying on being able to claim State benefits or savings. If you were entitled to receive benefit from the State towards your mortgage repayments you would only receive money towards the interest part of the repayment. Currently you would also have to wait several months to receive the income whereas with mortgage cover it is just 30 days with British Insurance.

Losing your income if you became incapacitated or were made redundant would be a huge blow. You would have to concentrate on finding work or making a recovery which would be hindered by the worry of how to meet your mortgage repayments each month. If you had taken out mortgage payment protection beforehand you would not have this worry as you would have something to fall back on.

You can take out mortgage payment protection by insuring up to a certain amount of your monthly mortgage repayment which would be pre-agreed with the provider. This sum of money would then be claimed back as a tax-free income if you became unemployed or were to suffer accident or sickness which meant you were unable to work. The money would go towards you being able to maintain the mortgage repayments for the term of the policy.

When looking around online for independent payment protection providers, one name that will jump out is leading independent specialist provider British Insurance. You will get a quality product that comes with few exclusions; however you would need to check these against your circumstances. They will offer savings of as much as 40% on the protection and a policy that comes with no excess as it is dated back to the first day of you becoming unemployed or from you being incapacitated. You would have to wait just 30 days before you would be able to put in your claim and you would then have 12 months of protection before the policy would cease.

Shopping around with other providers could reveal different terms and conditions so these would have to be checked. You could find that some providers might ask you defer from putting in a claim until the 90th day. You also need to check to find out how long you would be able to rely on the policy as with some providers it could be 24 months.

Mortgage payment protection should be considered by all homeowners as the results of mortgage arrears are devastating. If you miss just one repayment the mortgage lender will remind you of the missed payment and of course expect you to catch up. Without an income coming into the home this could be impossible and if you continue to fall into arrears and cannot make an agreement to catch up, the lender will start court proceedings to take your home. With mortgage cover to fall back on you would have a payment that would go a long way towards you staying out of arrears, at least for the term specified in the conditions of the cover. This would give you chance to search around for work or in the case of incapacity it would give you breathing space to concentrate on making a full recovery.

By taking out mortgage payment protection insurance you could be ensuring that you would not fall into arrears with the mortgage repayments. Mortgage arrears are the worst nightmare of any homeowner throughout the term of their mortgage as a single missed payment could be a downward spiral towards losing the home to repossession. With protection you would have an income coming in if you lost your own to accident, sickness or unemployment caused by redundancy.

You would take out mortgage payment protection by insuring up to a pre-agreed amount of the monthly repayment of your mortgage and then claim this sum back as an income, tax-free. It would go a long way towards you being able to maintain the repayments and so ensure that you are not at risk of eviction through the courts.

With specialist independent provider British Insurance you can choose the level of mortgage cover you need. You can take protection for accident, sickness and unemployment together or you can just take or unemployment cover only or incapacity protection only. The premiums are also based on the amount you choose to protect and age, which means the younger generation can enjoy the biggest savings. Mortgage cover costs up to 40% less when taken with British Insurance than it would to have it included in with the cost of the borrowing with the lender.

You would have to wait for a period of time before you would be able to start claiming on the policy and this would depend on the provider. Some specialists will begin to payout once you have been unemployed or incapacitated for a period of 30 days, British Insurance included. However some could ask for a period of waiting of up to 90 days. You would need to read the terms of any policy you were considering taking out as British Insurance pay for up to 12 months if needed while you some providers could offer 24 months cover.

All payment protection policies would include some exclusions. These are to be found in the small print and must be checked against your circumstances to determine eligibility. British Insurance will tell you about the exclusions on their website which means you can check before you buy the protection. They also add in just the most common one whereas some providers could add in many more.

Mortgage payment protection is a much better form of a back up plan than relying on being able to claim State benefits. You might be eligible to claim benefit from the State but you would have to check. Any money paid towards helping you to maintain your repayments would only be for the interest part of the mortgage and then up to a certain amount. Currently you would have to wait several months to see any money even if you were eligible to claim.

You are able to make savings of as much as 40% on the cost of the premiums for mortgage payment protection insurance if you choose ethical British Insurance as your payment protection provider. You would also be supplied with a product that is backed with years of experience and free information and advice so that you are able to check if mortgage cover would be suitable for your needs. Exclusions do need checking against your circumstances if you expect a mortgage payment policy to work in the way it is designed. Providing you do this before taking out the cover then you could fall back on the protection if you lost your income. A policy would cover accident, sickness and unemployment via redundancy.

You can take out the protection with British Insurance by insuring up to a pre-agreed amount of your monthly mortgage payment and then receive this back as a monthly income which would be tax-free. The sum of money would then go a long way towards you being able to meet the demands of the mortgage each month. You would not have to worry about falling into arrears and risk losing your home to the lender if you are unable to catch up. You would also not have to juggle around other bills in the hope of catching up on them in future as you would have the money each month towards the repayment.

Mortgage payment protection insurance (or MPPI for short) is a better way of ensuring that you would have the money needed to service your bills than relying on being able to claim State benefits or falling back on savings. Certainly, relying on State benefits would be disappointing. Not only would you would have to be eligible to claim money from the State but would have to wait several months before you would see any benefit. The income you did get towards your mortgage repayment would only go towards the interest part of the mortgage repayment and then only up to a certain amount. If you were to rely on savings these might let you down as they could run dry well before you got back to earning a living or found work again.

With British Insurance you would have to wait a period of 30 days of being unemployed or incapacitated before you would be able to put in a claim on your mortgage payment protection. Once you have made a claim the benefit would be backdated with British Insurance to day one of your unemployment or incapacity and then it would continue to provide your income for as long as 12 months. If you shop around you might find a provider that could offer 24 monthly payments but you would need to check in the policy small print to find this out before taking on the cover. You would also need to check when the provider would begin to payout on the cover as there are providers that might ask you wait to put in your claim up to 90 days of unemployment or from you being unable to work.

Mortgage payment protection could ensure that you do not lose your home by falling into arrears with your mortgage repayments if you lost your income as a result of an accident, illness or if you became unemployed. You would often be able to take out cover with a standalone provider for cheaper than with the lender which would allow you to protect a pre-agreed sum of your mortgage repayment. This sum would then be given back to you each month for up a certain amount of time after so long.

The terms and conditions of all policies vary so when checking out  mortgage payment protection you would have to read the small print. Some providers would offer the first payment after waiting just 30 days from being unemployed or from being incapacitated. Other providers might make you stand to the first 90 days and then you could put in your claim. Some payout an income each month for 12 months and with others it can be up to 24 months. If you choose payment protection specialists British Insurance you would have just a mere 30 days to wait before claiming and they would payback to day one of you being incapacitated due to accident or sickness or from when you became unemployed. They would then provide you with the tax-free income for up to 12 months which gives you ample time to have searched for work or to have recovered from incapacity.

When you take into account the fact that one missed mortgage payment would cause a great deal of anxiety and possibly could lead to you losing your home you can see why taking out a policy makes sense. If you are unable to meet your mortgage repayments and cannot afford to make an agreement to pay back what you owe then you would be taken to court. In just a short time you could be evicted from your home and have to leave. A policy does not have to cost a fortune, when taken with British Insurance you could save as much as 40% on the premiums.

Mortgage payment protection insurance from British Insurance can be taken as full cover which is accident, sickness and unemployment. However if you just need to take out protection against unemployment you can or you can just choose to protect against the possibility of you falling ill or suffering from an accident. With age based cover for mortgage repayments finally first time young home buyers can now afford to cover what are often huge borrowings which stretch their budgets to almost breaking point. You would have to check exclusions in the protection but British Insurance add in just the most common ones.