"Your home may be repossessed if you do not keep up repayments on your mortgage"
Well unless you have been orbiting the Earth since 2004, it's highly likely that you have seen the financial health warning that all those involved in property loans are legally obliged to include in any connected financial promotion.
You may well think that this warning and its connotations were obvious, and just common sense (which is incredibly uncommon!), however you would apparently be wrong. The government watchdog, the FSA has tasked itself with increasing financial awareness of mortgage default.
However, notwithstanding the F.S.A s best efforts, the stats make poor reading; informing us that only 18- 20% of mortgage payers had any kind of Mortgage Payment Protection Insurance in place to make the mortgage payment; if they are unable to. Poor result indeed.
Question is, are the stats wrong or do the other have 80% of mortgage payers have at least three to six months net mortgage payments set aside for a rainy day?
Well, based on the level of unsecured debt spread amongst the subject group; doubtful to say the least.
Now "an Englishman's home is his castle", or so the saying goes; and to some extent this is true.
Unlike our mainland European neighbours, where renting is the popular option until the early to late forties, in Britain, we love nothing more than to saddle ourselves, as early as possible with a nice big mortgage, and the responsibility that that entails.
Unfortunately, due to the now defunct Mortgage market, based more on loan to value, than affordability, the so called "non status" and other forms of very cheap easy credit; many now have a slightly larger "castle" than they would have, if the cost and availability of credit had been more realistic.
Now the party is over, and the days of cheap self cert, and other non status lending are well and truly over, many are left with large mortgages, with no where to go and find cheaper loan; they are at the mercy of the lenders generously (or not), and the standard variable rate for the product. Many of these loans were sold on to investors, and had clauses in the contract that allowed the purchasing company to vary the charge rate in some way. Nice.
This means that many borrowers are prioritising how they use their disposable income very carefully, and one of the first cut backs is insurance, particularly MPPI.
High risk strategy to say the least, when many borrowers are desperate to secure a new re-mortgage product, perhaps saving £ 150 per month, what would they do if they could not pay 3/4 of their loan ( that not covered by any potential benefits), due to Accident Sickness or Unemployment?
Well, the 20% of borrowers that have managed to see the wood for the trees, and have prioritised income away, from say, buying your daily sandwich at Prets, into a Mortgage Payment Protection Insurance Policy, just might hold on to their home, if the event of losing their income, due to Accident, Sickness or Unemployment.
If you are one of the 20% of borrowers, who have one of these MPPI policies, that have just been made redundant, you will know that you all you need to do is register for Job Seekers Allowance at the employment centre, send off the form that they issue you with, together with the claims documentation to your insurer.
You will probably also know that once your claim is accepted, the Mortgage Unemployment Insurance Policy; will start to pay a monthly benefit to cover your mortgage, for up to 12 months or until you find a job; whichever is the sooner.
Those of you that do not have a Mortgage Payment Protection Insurance Policy, and have been made redundant, may have to face the prospect of being repossessed. A very sobering thought.
If you do not have an MPPI policy, have no impending redundancy that you know of; maybe it's time to re-prioritise your insurance imperatives and take out a Mortgage Payment Protection Policy; before it's too late.
Well unless you have been orbiting the Earth since 2004, it's highly likely that you have seen the financial health warning that all those involved in property loans are legally obliged to include in any connected financial promotion.
You may well think that this warning and its connotations were obvious, and just common sense (which is incredibly uncommon!), however you would apparently be wrong. The government watchdog, the FSA has tasked itself with increasing financial awareness of mortgage default.
However, notwithstanding the F.S.A s best efforts, the stats make poor reading; informing us that only 18- 20% of mortgage payers had any kind of Mortgage Payment Protection Insurance in place to make the mortgage payment; if they are unable to. Poor result indeed.
Question is, are the stats wrong or do the other have 80% of mortgage payers have at least three to six months net mortgage payments set aside for a rainy day?
Well, based on the level of unsecured debt spread amongst the subject group; doubtful to say the least.
Now "an Englishman's home is his castle", or so the saying goes; and to some extent this is true.
Unlike our mainland European neighbours, where renting is the popular option until the early to late forties, in Britain, we love nothing more than to saddle ourselves, as early as possible with a nice big mortgage, and the responsibility that that entails.
Unfortunately, due to the now defunct Mortgage market, based more on loan to value, than affordability, the so called "non status" and other forms of very cheap easy credit; many now have a slightly larger "castle" than they would have, if the cost and availability of credit had been more realistic.
Now the party is over, and the days of cheap self cert, and other non status lending are well and truly over, many are left with large mortgages, with no where to go and find cheaper loan; they are at the mercy of the lenders generously (or not), and the standard variable rate for the product. Many of these loans were sold on to investors, and had clauses in the contract that allowed the purchasing company to vary the charge rate in some way. Nice.
This means that many borrowers are prioritising how they use their disposable income very carefully, and one of the first cut backs is insurance, particularly MPPI.
High risk strategy to say the least, when many borrowers are desperate to secure a new re-mortgage product, perhaps saving £ 150 per month, what would they do if they could not pay 3/4 of their loan ( that not covered by any potential benefits), due to Accident Sickness or Unemployment?
Well, the 20% of borrowers that have managed to see the wood for the trees, and have prioritised income away, from say, buying your daily sandwich at Prets, into a Mortgage Payment Protection Insurance Policy, just might hold on to their home, if the event of losing their income, due to Accident, Sickness or Unemployment.
If you are one of the 20% of borrowers, who have one of these MPPI policies, that have just been made redundant, you will know that you all you need to do is register for Job Seekers Allowance at the employment centre, send off the form that they issue you with, together with the claims documentation to your insurer.
You will probably also know that once your claim is accepted, the Mortgage Unemployment Insurance Policy; will start to pay a monthly benefit to cover your mortgage, for up to 12 months or until you find a job; whichever is the sooner.
Those of you that do not have a Mortgage Payment Protection Insurance Policy, and have been made redundant, may have to face the prospect of being repossessed. A very sobering thought.
If you do not have an MPPI policy, have no impending redundancy that you know of; maybe it's time to re-prioritise your insurance imperatives and take out a Mortgage Payment Protection Policy; before it's too late.
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