Looking At Your Mortgage Insurance Options
Mortgage insurance is most definitely recommended for experienced homeowners and those looking to get on the property ladder for the first time alike because of what every individual policy offers. Mortgage insurance can protect your repayments, usually for up to a year, if you were to ever lose your job via redundancy or contract a long-term illness that will prevent you from working for a time. Any individual has three options when it comes to mortgage insurance – the standalone policy, the add on policy and the high street provider policy. All three have integral differences that begin with the nature of the mortgage insurance on offer. A specialist insurance company, rather than those that count lending amongst their business, will offer a standalone mortgage insurance policy designed to protect consumers. There are a select few of these around at the moment purely and simply because the high street banks and lenders actively dominate the payment protection industry.
As a result of this though, standalone mortgage insurance providers tend to offer a product with a cheaper monthly premium. The majority of individuals that take out mortgage insurance get the add on. This is simply mortgage insurance that is added onto your mortgage by the same high street bank or lender you have your mortgage with. It is often quoted in with the cost of your mortgage and added onto the monthly payment. It may also add interest onto it as a result.
It may be convenient because you do not have to find a separate provider, but you may find yourself unable to cancel it if need be and in most cases, you will be paying well over the odds for it. The mortgage insurance offered by high street providers is usually the same as the add on policy, but is detached from the mortgage because you would hold it elsewhere. As a result, it is up to the provider to decide on the terms. They may expect an annual premium or monthly one for the mortgage insurance but would ultimately provide very similar cover.