Our mortgage team recommend taking out protection with a residential mortgage
Tuesday 10 April, 2018
Thomas Oliver’s Hertfordshire Mortgage Broker, Vishal Gulrajani, considers why anyone taking out a residential mortgage should have protection.
Vishal Gulrajani, Mortgage Broker in Goff’s Oak & Cheshunt, Hertfordshire said:
‘As a mortgage and protection advisor one of the biggest concerns is when a client does not take out any protection with a residential mortgage. This doesn’t mean that you shouldn’t protect your buy-to-let mortgages and other debts, but as a mortgage adviser I would recommend purchasing a protection policy for your own home as your residential property should be a priority. Imagine if the main breadwinner of the family was unable to work because of a serious illness. For example someone contracts cancer every 2 minutes in the UK. According to Cancer Research if you are born after 1960, 1 in 2 people will be diagnosed with some form of cancer during their lifetime. If a homeowner with a mortgage has no protection and is no longer receiving income because they can’t work and his employer doesn’t offer any benefit packages which would guarantee their income what does the family do and how do they afford to pay the mortgage? This is a major problem in the UK as far too often people have the attitude that it won’t happen to them. Unfortunately these are the harsh facts; we are living a lot longer which means we are more prone to illness and we are working longer hours until an older age which means more stress on our body and mind which is heavily linked to critical illnesses.’
Vishal Gulrajani, Mortgage Broker in Goff’s Oak & Cheshunt, Hertfordshire continued:
‘If you have no protection for your residential mortgage and you suffer from cancer, rather than utilising your pay-outs to help maintain your family’s lifestyle, you may now struggle to pay your bills causing you more stress and diminishing any chances you have of getting better and returning back to full health. Remember the problems don’t stop there because the mortgage company don’t care about your health they could repossess the family home leaving your family homeless and in financial destress.’
John Phillips – Mortgage Solutions estimates that 50% of individuals have a mortgage but aren’t protected. If you are one of them I would strongly recommend you speak to a financial advisor who can review the risks you are running not only for you but for your family. My approach as a mortgage adviser when talking to clients and offering mortgage advice is to always talk about protection and include it in a monthly budget so that if there is not enough disposable income to obtain both the mortgage and protection the client considers purchasing a smaller property so they can be fully protected rather than stretching themselves and running the risks of not being able to always afford protection. I understand there are still a few individuals that won’t take out any protection with their mortgage but please remember if you have a family that relies on you, as you are not only running the risk for yourself but you are running it for your entire family.’