If you’re looking into whether it would be a good idea to get mortgage protection insurance then knowing all the pros and cons of such a decision is the first, and most important step in doing so. While the recession may already have been officially declared over, the reality on the ground has forced many homeowners to seriously consider mortgage protection as a safeguard against redundancy or illness.
What is mortgage payment protection?
Mortgage protection guarantees cover for your mortgage payments in the event that you are unable to work due to redundancy, illness, or an accident. Mortgage protection is not compulsory, but some policies may require it, and it is one of the most popular options for mortgage cover in Ireland although there are also other options available.
5 Things You Need To Watch Out For When Getting Mortgage Protection
Property owners with a mortgage should seriously consider taking out protection on their payments. In these days of austerity it is even more important to be covered in case of any unforeseen periods of unemployment. To this end, here are five things you will need to watch out for when getting a mortgage protection policy:
Make Sure You Get the Best Deal
As most mortgage protection policies are taken up at the same time as the mortgage, most property owners will usually opt to simply use the one offered by their mortgage lender. However, since there is no obligation to take up a deal offered by any lender, shopping around is beneficial. Particular attention should also be paid to the excess period each policy has. This is the period of time you will have to wait before your mortgage lender can begin receiving their payments through your cover so choosing one that is comfortable for your finances is also crucial.
How selective are your chosen mortgage protection underwriters?
The more selective your chosen mortgage protection providers are, the more likely you are to get the best deals that offer the lowest premiums. These are worked out according to your age with policies getting more expensive the older you are and as in the first tip, independent providers are usually able to offer better deals than household names.
What does your mortgage protection policy cover?
An unplanned drop in your income will not only impact your mortgage repayments, it may also affect your livelihood. As one of the biggest investments most people are ever going to make, it makes sense to get mortgage cover, but so does investigating the available life insurance or income protection policies available to you if your finances are already stretched.
Understand Your Policy
If any aspects of your policy are particularly hard to understand then it is advisable to get advice and help from specialists in the industry to ensure your peace of mind and full mortgage cover.
With conditions still difficult for borrowers, proof of steady employment is a positive factor. Being in a position for over at least six months (ideally more) will reassure lenders that you currently have a guaranteed and stable income which will improve your premium choices.
Mortgage protection should always be an important consideration for both new and existing property owners, as getting a policy not only provides peace of mind, it also provides actual cover in the event of any unplanned disruptions to your livelihood.