MORTGAGE PROTECTION – ESSENTIAL FOR HOME-OWNERS
Mortgage protection cover is designed solely to ensure that your mortgage is paid off in the event of your death. It runs for the same term as the mortgage itself, and the cost of it decreases as the amount owed on your mortgage reduces.
When you take out a mortgage, your lender will insist on your having mortgage protection insurance – this is to safeguard the loan. Your estate will benefit from any additional funds left in the policy after the mortgage is paid.
It is important to point out here that you are under no obligation to take out a mortgage protection policy with that lender. The ‘shop around’ rule very much applies! You can also switch mortgage protection insurance provider to get a better deal.
So with mortgage protection insurance, you don’t need to worry about your loved ones having to repay your mortgage in the event of your death, but what about the scenario where you can’t repay your mortgage because you become so ill that you can’t earn an income?
Mortgage Protection is essential for anyone with a mortgage. If you fully own your home you may not need mortgage protection.
You can add serious illness cover to your mortgage protection policy. This will give you a cash lump sum should you be diagnosed with a specified serious illness. That way, you have a buffer to pay bills such as your mortgage even though you can’t work because of your illness. For more on serious illness cover (also known as critical illness cover or specified illness cover), See below for further information on serious illness.
POINT OF NOTE: IF YOU DO NOT KEEP UP YOUR REPAYMENTS YOU MAY LOSE YOUR HOME!