Mortgage Payment Protection Insurance, sometimes referred to as MPPI, is a form of mortgage insurance that provides you with financial support to help you meet your mortgage payments should you suddenly find yourself out of a job.
Expect the unexpected
Sudden illness, an injury or involuntary redundancy often happens when you least expect it, and the last thing you will want to add to the burden is the fear of losing your home. This can happen if you are without a form of mortgage cover like mortgage payment protection, and find yourself unable to meet the mortgage repayments in the absence of your monthly wage.
Peace of mind
Mortgage Protection Insurance doesn’t just offer financial support, it also offers peace of mind, and you may find a policy that will pay out within a month of your income stopping, and it might even be back dated to the date your income stopped. For many who find themselves suddenly unable to work because of accident, illness or injury, it can be a huge relief knowing that even though your income has stopped, having mortgage payment protection means you are still able to pay your mortgage and not risk losing your home.
How does it work?
Should you find yourself out of work due to illness, or an injury from an accident or from involuntary redundancy; if you have a mortgage payment protection policy you will receive a monthly tax-free income that will cover in full or in part your mortgage repayments. Some insurers offer 100% coverage, and this should also include any interest payments that you need to make each month. If you’re looking for mortgage payment protection with a lower premium, you may only wish to cover a percentage of your monthly repayments and this is also possible.
When do you receive your mortgage payment protection payments?
This will depend on the terms and conditions of your mortgage payment protection policy but generally it is between 30 and 60 days of your last day of employment that you will receive your income to go towards your mortgage payments. Each mortgage payment protection policy will be slightly different depending on your requirements for the policy and it’s always worth checking the terms and conditions so that in the event of you being out of employment, you know how long it will be before you are receiving an income once more.
How long do I receive an income for?
The length of time that you receive an income under your mortgage payment protection insurance will also depend on your insurer and your specific policy. Most insurers offer an income to cover mortgage payments for between 12 and 24 months.
Choosing the right mortgage payment protection policy for you
Having mortgage cover is an important decision and it’s essential that you choose a policy that is going to be the best for your circumstances. You will want to consider how long you are happy to wait before receiving your first income payment, how long you would want the policy to pay out for, and how much of each mortgage payment you would want to be covered for. There is more awareness now about the mortgage payment protection industry since it was found that some providers were selling unsuitable insurance to customers. This has only benefited the state of the industry today as more people are now aware that they can shop around different providers; you don’t have to go with your mortgage lender, in order to get the best deal.
