Mortgage payment protection insurance is one of the forms of payment protection that is taken out if you want to insured your repayments against the possibility of losing your income to unemployment or incapacity. Should either of the events occur you would have a replacement income, which was chosen by you and agreed by the provider, towards you maintaining your repayments. Without this income you could have to make some drastic cutbacks and still be unable to find the much needed money.
Mortgage payment protection insurance (MPPI) does not have to cost a great deal as you can tailor it to suit your needs. You could choose to take a policy against both events or you could choose to protect one event of the other. Your provider could also give you carer cover in your policy and if so you could claim if you had to give up work to take care of a loved one that became incapacitated. You could be able to make your claim after the 30th day but with others it could be up to the 90th day before a claim could be made. You might continue claiming an income for up to 12 months or with other providers it could be 24 monthly payments before your policy ceased.
If you had to wait for up to 90 days then you would need to find the money yourself during this time or you would fall into mortgage arrears. You would also need to bear in mind that a policy providing you with an income over 24 months would work out more in premiums that one paying over 12 months.
You would have to check mortgage payment protection for exclusions. There would be some in any policy with some providers just including the most frequently found exclusions and others adding in many more. These would have to be checked against your lifestyle to ensure that you would be eligible to take out a policy and make a successful claim. Some common exclusions include working full time and you having to be in work for so many months before taking out the policy. Usually you would have to live in the UK, Channel Isles of the Isle of Man to be eligible to take out your policy.
Mortgage payment protection insurance could be a far more suitable form of security than relying on claiming an income from the State. You would need to prove you are eligible to claim from them and any money that you might be entitled to receive would only go towards you being able to maintain the interest part of the mortgage repayments. Savings might also let you down as they could run dry before you had found a replacement job or had had the time to recover from your incapacity. You would not know how long you would have to use them and you could run through what took you many years to accumulate and still be left with a struggle.
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