Having the money to be able to continue paying your mortgage month after month is imperative. Get behind on the repayments and you are at serious risk of losing the roof over your head as the lender will take you to court. You could lose your income and not be able to pay your mortgage if for instance you lost your job to unemployment. Redundancies happen and it could happen to you with little warning. The same applies to illness or having an accident. Mortgage protection insurance would safeguard against all three eventualities.
Often when taking on a mortgage the lender will try to get you to take out mortgage protection insurance. However this is not entirely due to the fact that they are looking out for your best interests, but rather that it brings them in around £4 billion in profits each year. Protection for your loan is notoriously expensive when taking it this way and you do not have to take it alongside the borrowing. You are able to shop around and find a policy much cheaper if you look with an independent payment protection specialist. This is also the way to get access to all the information needed to be able to determine if cover is suitable.
There has been a lot of controversy regarding payment protection products since an investigation into the sector began in 2005 after the Citizens Advice began an investigation into the sector. The Financial Services Authority also conducted an investigation and this led to firms receiving fines, which included a mortgage firm. It is important for consumers to realise that payment protection products are not at fault but it those who sell them without giving out advice that are to blame. If you have access to the key facts and exclusions so you can check them against your circumstances then you can have a policy that you can rely on.
With a specialist payment protection provider you are able to choose the amount of protection you wish to take out. If you need protection against accident, sickness and unemployment only then you can take just this. However you might just want to insure against unemployment only or accident and sickness only. This will go towards determining how much you pay for the premiums along with how much cover you need and your age. If you take out age based mortgage payment protection then even those who have pushed their outgoings to the limit can afford to protect their mortgage repayments.
You do have to compare the terms and conditions of any mortgage protection insurance policy you are considering taking out as this will tell you when the cover would begin and when it would end. Some providers will offer a policy that could payout after unemployment or incapacity of just 30 days. Others could ask that you wait for as long as the 90th day. Sometimes providers will payout for a period of 12 months and others might continue providing you with benefit for up to 24 months.
