Mortgage protection coverage can mean the difference between you keeping your home and losing it to the mortgage lender. A policy would supply you with the income needed to be able to pay your mortgage on time without having to struggle to find it each month when the payment was due. You would not be at risk of becoming a statistic of repossession due to unemployment, accident or sickness.
You are able to take out mortgage cover for accident sickness and unemployment together, accident and sickness only or for incapacity only. The level of cover you would need would depend on your personal circumstances.
Mortgage protection coverage taken with a standalone specialist provider works out cheaper than having it included in with the loan. The cost of protection with the high street lender can add up to a considerable sum of money. Standalone payment protection providers offer cover based on the amount you want to protect, your age when applying and the level of protection you want. You are able to take out cover for accident sickness and unemployment, accident and sickness only or for unemployment only. With age based protection the younger generation can take advantage of the cheapest premiums which makes protecting their income affordable.
Being able to pay your mortgage each month is essential as if you cannot the lender could take you to court and you could find the judge taking the side of the mortgage lender. Even if you missed just one mortgage repayment you would have to make an agreement with the lender to catch up on the arrears while also at the same time maintain your repayments. However without an income you would not be able to do this and the lender would have no option but to start court proceedings. If this happens then you would be evicted from your home. When this is taken into account you can see why covering the repayments of your mortgage should be considered essential.
A policy with specialist providers will vary considerably. You have to check the terms and conditions if you are to find out when the cover would end and begin. Some providers will begin to payout after you have been out of work or unfit for 30 days while with others it can be as much as the 90th day. The same would apply when it comes to how long the policy would last. Some providers would provide you with a payment each month for 12 months while others could supply a policy that pays out a payment each month for 24. You would also have to check the exclusions as there are some in all payment protection policies.
Mortgage protection cover could possible have helped the 18,000 individuals who so far this year have lost their homes to repossession. The Council of Mortgage Lenders has estimated that around 45,000 homeowners will fall prey to repossession by the end of 2008. However if mortgage protection is made available cheaper everywhere, then more people will be able to protect their mortgage repayments and avoid repossession. Buying mortgage cover with a standalone payment protection specialist is far cheaper that adding in the cover when you take out the loan.
Simon Burgess is Managing Director of the award-winning British Insurance, a specialist provider of mortgage protection cover. |
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