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Mortgage Protection

Taking out a mortgage is a big financial commitment for 25 years or more of your life. Not everyone can count on being in good health for the duration of the mortgage term, which means payment protection is a must if you have dependents relying on your income.

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How Can Mortgage Protection Benefit Me?

Mortgage protection is sometimes referred to as mortgage life insurance and in most cases they can mean the same thing. Mortgages are usually the biggest monthly financial outlay we make, so covering yourself if the worst happens means you will be freeing your family from the burden of having to cover the mortgage payments if you are no longer around.

Depending on the type of mortgage protection cover you choose, your payments can be protected if you have a critical illness or if you die. While none of us want to contemplate this possibility not having payment protection is a risk that could leave your dependents in danger of losing their home.

Is Mortgage Protection Cover Right For Me?

Insurers always assess what you pay by the risk of them paying out, so if you are over a certain age, have a history of health problems or anything else that may increase your risk of serious illness or death, you will generally pay higher premiums.

How We Can Help

There are various forms of personal protection that you can have and Green Mortgages can help you choose the product that is right for you. Please give us a call to speak to one of our advisors.

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Frequently Asked Questions

These questions help give some guidance to buyers from all angles of the property ladder. If you have any questions that aren’t covered opposite or if you would like a little more clarification on any of the points discussed, our team of experienced advisors are on hand to help you through any part of the buying process

Mortgage protection insurance is an insurance policy that covers your mortgage payments in the event that anything unfortunate happens and leaves you unable to pay your mortgage.

If you’re made redundant, injured at work, develop a serious illness or, worse, pass away, mortgage protection insurance can take care of your monthly mortgage payments. In the latter case, it can pay off your mortgage in full and perhaps even leave your loved ones with some extra money.

Being unable to meet your monthly mortgage payments and potentially losing your house is a huge worry for any homeowner. Mortgage protection insurance shields you from this nightmare scenario. If you’re unable to work, it reduces the stress of keeping up with your mortgage payments. If the unthinkable happens and you’re no longer around, it relieves your family of the burden of paying the mortgage.

If you get a mortgage, you aren’t legally required to have mortgage protection insurance. However, it’s an incredibly valuable investment and something you should definitely consider. Green Mortgages are mortgage brokers in Cheshire who can give you the help and advice you need to make an informed decision.

There are different forms of mortgage protection insurance and various policies out there that cover you for different things. The two forms of mortgage protection insurance are: mortgage payment protection insurance (MPPI) and mortgage life insurance. Although they both fall under the mortgage protection umbrella, they cover two very different things and pay out in different ways:

  • Mortgage Protection Payment Insurance — This covers your mortgage if you’re unable to work due to unemployment, an accident or serious illness. These insurance policies pay out a certain amount each month to cover your mortgage payments.
  • Mortgage Life Insurance — This covers your mortgage if you die before you pay it off. Unlike mortgage payment protection insurance, mortgage life insurance pays out a lump sum that covers the full amount of your outstanding mortgage, and anything left over goes to your family or dependants.

There are two different types of mortgage life insurance:

  • Level term — This covers you for the same amount of money for the duration of your policy. It’s best suited for interest-only mortgages. However, if you have a repayment mortgage and your mortgage decreases over time, you’ll receive a lump sum that pays off your mortgage and provides extra money for your family.
  • Decreasing term — The amount you’ll receive decreases over time in line with your outstanding mortgage balance. It’s best suited for repayment mortgages.

As for mortgage payment protection insurance, there are three different types of policies, each of which gives you a different level of cover. The more cover a policy provides, the more expensive it will be.

  • Unemployment only — This covers you only if you’re made redundant.
  • Accident and sickness only — This covers you only if you suffer a serious injury or develop a serious illness that prevents you from earning an income.
  • Accident, sickness and unemployment — This covers you if you’re made redundant, develop a serious illness or suffer a serious injury that prevents you from earning an income. It provides the most comprehensive level of cover as far as MPPI policies are concerned.

We’ve already covered mortgage life insurance, which is pretty straightforward: if you die before you pay off your mortgage, the policy will pay out a lump sum that covers the full amount of your mortgage, with any leftover money going to your loved ones. You get to choose the length of cover, the type of cover and the value of cover, which will usually align with your outstanding mortgage.

Mortgage payment protection insurance policies are a bit more complex. These policies pay out a set amount of money each month to cover your mortgage payments. The amount of money you receive each month is typically equal to your mortgage repayments, although it’s possible for you to get up to 125% of your repayments to cover additional monthly expenses.

You’ll receive monthly payments from your policy until you either recover and return to work or you reach the maximum length of your claim period, usually 12 or 24 months. Under normal circumstances, your policy will end when you pay off your mortgage.

Mortgage protection insurance costs will vary depending on your age, your health and how much your mortgage payments are. Your job can also affect how much you pay for mortgage protection insurance.

With so many different options out there when it comes to mortgage protection insurance, it’s important to speak to an expert before taking out a policy. At Green Mortgages , we’re mortgage advisors in Chester who can help you to find mortgage protection insurance that provides you with the peace of mind that you’re looking for.

One of our friendly, professional and experienced advisors will sit down with you (or talk to you over the phone) to get a thorough understanding of your financial situation. From there, we’ll compare a number of policies from a wide range of providers to make sure that you get the best deal and that you’re fully aware of any differences in cover between each option.

If you’re looking for competitive mortgage protection insurance in Chester that works for you, get in touch with Green Mortgages today.