Archive for the ‘Mortgage Protection’

You may wonder what mortgage protection is and whether you need it. So, first of all, let’s take a look at how you home could be under threat. Repossessions are soaring and, according to a recent news paper report, some 130 families are losing their homes every day. The credit crunch has bitten us all hard and it is unlikely that there is no one who has not been affected. So, how would you protect your home if you were made redundant or became unable to work due to incapacity?

Redundancy package

Even the most generous of redundancy packages could soon be eaten away if you were unable to find a job straight away. Mortgage repayments, as well as other costs such as insurances etc could soon see any severance pay dwindle.

State benefits cannot be relied upon as the assistance they give will often not match all your monthly mortgage costs. You also have to meet strict eligibility criteria in order to receive benefits and even then, will have to wait several months before the payments become effective.

Sick pay

The same goes for sick pay. Even if your employer offers an extremely sick pay scheme, will it be enough to meet your monthly outgoings? The last thing you want to be doing when on your sickbed is worrying about paying the bills.

That is why mortgage protection insurance is so valuable. Should you make a claim, you will receive a tax free amount every month that can be used towards maintaining your mortgage repayments and other costs such as home insurance and life cover.

How the long the mortgage protection policy runs depends on the individual provider, but it will typically be for 12-24 months or when you are back at work - whenever is the sooner.

The mortgage protection policy will have a waiting period before you are able to start receiving the benefits. This is typically between day 30 and 90 of being out of work due to incapacity or involuntarily unemployed.

Some mortgage payment protection insurance providers will also backdate their policies to the first day of you being unfit for work or of involuntary unemployment, ensuring that you don’t lose out financially.

As you can see mortgage protection really can take away the stress and worry of how you will you manage financially in the event that disaster strikes, And by purchasing your cover from a standalone provider such as British Insurance, it does not have to cost a lot, with premiums starting from as little as a few pounds for every £100 worth of protection required every month.

Although some people might describe it as a ‘millstone’, a mortgage is still the only way in which many people are able to afford to buy a house. Deposits help keep the amount you need to borrow down, but most people will still need a considerable slice from the bank. This remaining piece of borrowing is basically a giant loan, a secured loan in fact, with the house itself as a guarantee that you will be able to pay it back. Failure to keep up with repayments of course leads to the chance of repossession. Although it’s impossible to guard against every eventuality, the likelihood of this unwanted outcome can be minimised with the help of a mortgage protection policy.

This kind of cover, also known as MPPI or mortgage payment protection insurance, is designed to give someone a helping hand if they suddenly lose their job and income through no fault of their own. Typical circumstances covered include ending up without work due to long-term sickness, injury after accidents, and involuntary redundancy. The latter may be of particular interest to people concerned about their job security in times of an economic downturn.

The cover works by providing someone with a monthly cash sum for each month they are without an income. A successful claim will first have to be made, and typical exclusions mean someone off work due to a pre-existing medical condition will not be covered. Also, a person will not be able to claim if it can be proved they were given notification that they were to made redundant before they took out the policy.

Subject to success, the policyholder can then expect a tax free sum into their account from their insurer each month. The first one will normally arrive about 30 days after the claim has been made. It can normally be spent in a number of ways and will be geared to help someone not only with their repayments but also with the home loans interest, any council tax costs, utility bills, and even groceries. It is designed to keep someone going until they are able to get back into work.

A basic mortgage protection policy will not normally provide cover for 100 per cent of someone’s monthly mortgage outgoings. Policies normally start at 50 per cent and many companies will offer higher levels of cover enabling someone to perhaps insure 60 or 70 per cent, for example. Of course, a higher premium will normally be involved in this case.

The best value policies may be available from more independent companies rather than lenders themselves or big name high street insurers and banks. One example is the ethical British Insurance. Company managing director Simon Burgess said: “A mortgage protection policy can be a psychological bonus, giving you peace of mind when times start to get tough. Should you ever suffer the misfortune of having to claim on it, it will of course provide a physical, financial boost which could be the difference between holding on to your home and losing it.”

Mortgage protection - or mortgage payment protection insurance to give it its full name - is a very valuable form of insurance that is taken out to protect against a loss of income through unemployment or incapacity. You could take out the cover at the time of borrowing with the lender on the high street but you can make savings on the insurance by choosing to search around independently for the policy. If you choose to take a policy with ethical payment protection specialist British Insurance you can save around 40% on the premiums.

You choose the amount of your monthly mortgage repayment you want to insure against unemployment and incapacity which the provider pre-agrees upon and this would be the sum that you received back if you fall victim to one of the events. With ethical British Insurance you can choose the type of protection needed as you might not need to take out protection for accident, sickness and unemployment together. If this is the case you might just need to protect against unemployment only or incapacity alone and with British Insurance you can. You can also choose to take out cover for a 12 month period or for 24 months and you would be eligible to claim from the 30th day with British Insurance dating the protection back to day one of you becoming unemployed or incapacitated. If you search with other providers you would need to check for when you could claim as with some providers it could be as long as 90 days.

The income that mortgage protection would payout would be used towards servicing the repayments of the mortgage and would provide you with peace of mind that you would not be at risk of falling behind on the repayments. Mortgage repayments are a huge worry to all homeowners as falling behind on them could mean the lender would choose to take repossession proceedings if you are unable to come to an agreement to pay back.

You would have to check for suitability of the protection against your circumstances as there are exclusions in all policies offered by all providers. Ethical British Insurance adds in just the most frequently found exclusions and they provide you with information that you need to check exclusions against your circumstances. After ensuring you would be eligible to claim you would then have something to fall back onto if needed.

Mortgage protection could be a far better solution than turning to using savings to fall back onto as savings might not last for the duration of your unemployment or incapacity. It could also be a better plan that risking being eligible to claim benefit from the State. State benefits towards mortgage repayments would only go towards the interest part of the mortgage and then only up to a certain amount. It would also be many months before you would see any money at the current time.

Mortgage protection is a form of payment protection insurance (PPI) that is taken out to insure against the possibility that you could lose your income after falling sick, suffering an accident or becoming unemployed. You would take out a policy by insuring up to a defined amount of your monthly mortgage repayment with the provider and if you became a victim to one of the events you would claim back the sum you had insured and it would be tax free.

Mortgage protection is offered upon borrowing with the high street lender but usually this would be the dearest way of taking out insurance. If you choose to take on cover independently you will not only make savings of as much as 40% if you choose ethical payment protection specialist British Insurance, but you would also get great terms on the protection. The policy would come with just a few exclusions and British Insurance supply you with all the information needed so you can check them against your circumstances. Other specialists could add in many more exclusions so when comparing always check the small print for exclusions. You would also get cover that comes with no excess as they backdate to day one of you being incapacitated or from you being made redundant.

A policy with British Insurance could be claimed on from day 30 and it would then provide you with an income for as long as 24 months before ceasing. The money from the insurance would go towards your mortgage repayments and help to stop you from falling into arrears. It would provide security for its terms which would allow you to concentrate on making a recovery or gives you time to search around for work.

Other providers could offer different terms so these must be checked before buying. There are also some providers that might state you have to wait for up to 90 days before putting in your claim so you need to check the terms for this too.

Another advantage to taking your mortgage protection from leading specialist British Insurance is that you can choose the type of insurance you need. You can take out insurance against accident sickness and redundancy combined. However you could just need to cover the possibility of a lost income due to redundancy alone or incapacity on its own. This would go towards setting the premium you pay as would your age and the amount of your monthly mortgage repayment you chose to protect. Mortgage payment protection can be a far better solution than relying on being eligible to claim money from the State. Even if you are eligible you would only receive benefit towards the interest part of the mortgage and then only up to a certain amount. Currently you would also have to wait for several months before you could claim State benefit and by then you could already be in mortgage arrears. Mortgage arrears can lead to the lender repossessing your home and mortgage payment protection insurance can help to stop that happening.

A mortgage is a big commitment and not everyone will always be able to keep up with theirs – and this can be a major concern. A sudden loss of income can quickly lead to a home loan crisis as this type of borrowing on a property normally involves the biggest regular outgoing for an individual. It is also secured against the home itself, meaning repossession is a real threat if the bank doesn’t get its money. But did you know borrowers can protect their ability to keep up with their mortgage commitments with mortgage protection, a form of financial insurance?

Mortgage protection, also referred to as mortgage payment protection insurance (MPPI), is a policy which will provide payouts if someone is unable to keep up with repayments through losing an income through no fault of their own. The inclusive circumstances are usually long-term sickness, injury from an accident and involuntary redundancy. The payouts themselves normally start to arrive following a 30 day initial period after a claim and arrive tax free into the policyholder’s bank account.

It is important to consider the fact that a mortgage protection product will not normally provide funds for 100 per cent of a person’s monthly mortgage repayments. A portion of about 50 per cent is the normal starting point and cover can sometimes be arranged for a greater slice – say 70 per cent, although naturally this will typically attract a bigger premium.

Some policies will provide protection for a policyholder who has to leave their job and therefore loses their income because they have to become someone’s full-time carer – it is always worth double checking with an insurer and reading the policy small print if you are unsure whether or not it will fit your needs.

So, how long will a policy pay out for once a successful claim has been made? Not indefinitely is the short answer, and most will provide support for 12 months, although some will stretch to 24, depending on the insurer

Mortgage protection can sometimes be sold ‘at point of sale’ when a person is taking out the home loan. This means a policy might be offered by the home loan lender themselves, and cover which is supplied in this way can sometimes be of poor value. Instead, a borrower could try shopping around and may want to try some more independent cover suppliers which can offer better deals than the bigger high street lenders. One such firm is protection specialists British Insurance. Simon Burgess, managing director of the company, says: “There is no need to worry unduly about the risks of suddenly not being unable to keep up with repayments. Mortgage protection can help take away the concern of what might happen if you are unfairly stripped of your income.”

Mortgage protection can be a safety net to fall back onto if you should become unemployed, suffer an accident or fall sick and lose your income. You would protect an amount of your monthly mortgage repayment and claim this amount back, tax free each month for the term of the policy, if you became incapacitated or unemployed.

The sum of money could make a huge difference when it comes to the balance between losing your home to repossession and keeping it. Mortgage arrears are the worst nightmare of any homeowner who has to maintain repayments over many years because just a couple of months of missed payments and no hope of catching up on them could mean the lender will take you to court. If the judge were to agree with the mortgage lender you would be given an eviction date and have to leave your home so the lender could sell it to get back their money. With mortgage payment protection behind you at least you would have some money to go towards the repayments each month.

If you take your mortgage protection from ethical British Insurance there would be no excess to stand to as British Insurance pay back to the first day your unemployment or from you being incapacitated. You could claim benefit for day 30 and then receive a payment for 12 months which would provide you with plenty of time to search for work or concentrate on making a recovery. However if you looked with other specialists you might be able to take out cover that would last for 24 months but you would have to check out the small print in the policy to discover this. You also have to read the terms to check when you can make a claim as some providers will extend this to at least the 90th day of you being unemployed or incapacitated.

You can take mortgage protection alongside the borrowing with the lender but usually this will be the dearest way of covering your repayments. A standalone provider can save you money on mortgage payment protection and if you choose independent payment protection specialist British Insurance you can save up to 40%. With British Insurance you can take out just the amount of cover you need. You can insure against the possibility of accident, sickness and redundancy in one. However you can also choose just to insure against accident and sickness or just against unemployment only. The type of protection you choose will go towards determining how much you pay for the premiums as will age and the amount of your mortgage repayment you cover. As British Insurance offer premiums based on age this means they provide the younger home buyer with the chance to protect their payments, whereas before high priced protection was out of their reach.

Mortgage protection is a great way of protecting your monthly mortgage repayments against the possibility that you could lose your income through falling ill, suffering an accident or becoming unemployed by such as being made involuntarily redundant. You can take out the protection by insuring a pre-agreed portion of the mortgage repayment and then claiming this sum back as an income which would be tax-free if you become unemployed or incapacitated.

The money from the policy would go a long way towards you being able to service your mortgage repayment despite having lost your own income. It is essential to maintain the repayments as mortgage arrears can lead to home repossession. With mortgage protection to fall back on you would know that you had a sum of money coming in at least for the term of the policy.

When the cover would begin and for how long it would payout would all depend on the provider. If you choose to take a quote from ethical payment protection provider British Insurance then you would be getting protection that came with no excess, as they would back pay on the policy to day one of you becoming unemployed or from you being incapacitated. You would be able to put in a claim on the protection after the 30th day and would receive a payment each month for as long as 12 months.

Shopping around and comparing policies with other providers might reveal cover that would continue paying for up to 24 months but you would have to read the small print of the policy to find out. You would also have to read the small print to find out when you would be able to put in a claim, as with some providers you might have to wait for up to 90 days.

Another benefit to taking out your mortgage payment protection insurance with leading independent provider British Insurance is that you be able to choose the type of cover most suitable to your circumstances. You could take out full protection for accident, sickness and unemployment together. However you might only need to cover against the possibility that you could lose your income due to unemployment. You can also choose just to cover incapacity alone. The type of cover taken along with your age and the amount you choose to protect, up to the amount specified by the provider, would go towards the cost of the insurance. With British Insurance you could save up to as much as 40% on the premiums when compared with taking a policy alongside the mortgage with the high street lender.

Your mortgage protection from British Insurance makes a better safety net than risking relying on savings. Savings could run out well before you had found work or had made a recovery and you would then be left struggling to find the whole of the mortgage payment each month.

Servicing your mortgage repayments each and every month is a must if you do not want to fall into arrears and risk losing your home to the lender through repossession. One way of protecting against a lost income due to accident, sickness or unemployment is by taking mortgage protection. Cover does not have to work out expensive if you take it with independent payment protection provider British Insurance as they save you as much as 40% in comparison to high street lenders.

Mortgage protection will pay you a tax free monthly income in the event that you lose yours through redundancy or incapacity.  The sum of money that you received back from the mortgage payment protection insurance (MPPI) would then go towards your monthly mortgage repayment and this would stop you from mortgage arrears.

If you were to get into arrears by just a couple of months it would mean you coming to an agreement with your mortgage lender to repay what you owe and of course you would be expected to be able to continue servicing your regular mortgage instalments. Without an income coming into the home it would be impossible to make such an agreement so the lender would have no choice but to start proceedings to repossess. In just a few months a judge could issue an eviction date and you would have to leave everything behind. A small premium payable each month with a standalone provider would go towards ensuring that this did not happen.

British Insurance would pay out on your mortgage protection once you had been unemployed or incapacitated for a period of 30 days. They would offer to payback on the protection to day one of you becoming unemployed or from being incapacitated and you would then receive an income for up to 12 months if necessary. If you chose to shop around with other providers and obtain quotes you might find that some would payout for up to 24 months so you would have to check the small print of the cover. You would also need to check when you would be able to make the first claim on the protection as some providers could ask for a period of deferment up to 90 days from you becoming unemployed or incapacitated.

The terms and conditions of mortgage protection would also need checking for you to be sure of being eligible to put in a claim. With British Insurance you can find these on their website. Once you have checked them against your lifestyle you can then take out the cover with British Insurance there and then. You would need to decide which level of protection you wanted to take out and how much you wanted to cover as these would determine how much the premiums would be, as would your age.

Mortgage arrears are the worst nightmare of any homeowner. Being able to maintain the mortgage repayments is essential and the worry of falling sick or suffering an accident that meant you were unable to work is ever present. With news of redundancies announced all the time this is also another huge cause for concern. All of these situations can be protected against by mortgage protection cover. You could be offered a policy when taking out the mortgage but you can also choose to shop around and take out the protection independently.

By shopping around and comparing quotes for mortgage protection you can make savings of up to 40% if you choose to take out cover with standalone provider British Insurance. You would be able to insure up to a pre-agreed amount of your mortgage repayment and then claim this tax-free sum back when and if you had to put in a claim. The money would go a long way towards ensuring that if you did lose your income you would have something to fall back on and rely on to keep your mortgage repayments going.

With ethical payment protection provider British Insurance you can make a claim from just the 30th day of losing your income to redundancy or accident and sickness. They would back pay on the protection to the very first day of you becoming unemployed or from being incapacitated and then give you a sum of money each month for up to 12 months. If you were to look with other providers and check the terms of their cover you might find that you could receive an income with them for up to 24 months. You would also need to check the terms to see how long you would have to wait before you would be able to put in a claim on the cover as some providers state 90 days at least before claiming.

With mortgage cover to give you peace of mind you would not have the worry of the lender repossessing your home by you incurring arrears which you are unable to catch up on. A single missed mortgage payment could be enough cause for concern with the lender and you as they would send out a reminder letter. If you were to be unable to continue paying and missed more payments the lender would ask you to make an agreement with them. As you have not got a regular income coming in this would be impossible and there next course of action would be to instruct a solicitor to begin court proceedings to have you evicted.

Your mortgage protection policy does come with exclusions which you would need to check against your circumstances. Some providers could add in many exclusions while others British Insurance included would add in just the most common ones. An ethical provider would make you aware of their existence before you sign up for the protection and British Insurance tells you of them on their website. If you do not have access to these then you could take out protection that you would not be able to claim against.

If you were to fall ill or suffer from an accident that meant you were unable to work you would not want to be worrying about where you would get the money from to continue meeting the demands of your mortgage. The same would apply if you had to look around for work after becoming unemployed. Mortgage protection could ensure that you would not have these financial worries.

You can take out protection by insuring up to a pre-agreed sum of your mortgage payment and if were to lose your income you can claim this sum back as a tax-free payment each month. This sum of money would then go towards you being able to service the payment of the mortgage and can stop you from falling into arrears. If you were to get into arrears with the mortgage you would have to reach an agreement with the lender. If this was not possible due to not having any income, then the lender would seek to repossess your home through the Courts. You would also see your credit rating affected which would mean that being approved for credit in the future could be very difficult.

Mortgage protection insurance – also known as mortgage payment protection insurance (MPPI) - can be taken out when you take on the borrowing. By choosing to have it added in with the lender you could be paying over the odds for the cost of the insurance. You can choose to shop around with an independent payment protection specialist. If, for example, you choose to get a mortgage payment protection quote with ethical British Insurance you can save as much as 40% on the cost of the premium.

British Insurance bases their premiums on age, the level of cover and the amount you choose to protect. You might want to insure against accident, sickness and unemployment together but you could also chose to just take out cover against unemployment or incapacity. As the premiums are based on your age when applying British Insurance makes covering mortgage repayments possible for the younger first time home buyer. The individuals often take on huge mortgages which can leave them with little left over to pay for expensive cover.

Some homeowners rely on State benefits as a means of being able to maintain the mortgage. However you would have to wait a period of time before seeing any benefit and you would only get a payment towards the interest part of the mortgage. Savings could also let you down as they might not be able to maintain the mortgage repayments for many months and it might take this long to find work or to make a recovery.

Mortgage protection taken with British Insurance would provide you with your first income after being unemployed or incapacitated for at least 30 days. They would backdate the policy to day one of you becoming incapacitated or unemployed and would then allow you to claim for 12 months. If you choose to shop around with other providers you could find protection that might payout for up to 24 months but checking the small print is essential as providers can also state that you wait to claim for up to 90 days.