Evaluating Mortgage Payment Protection Insurance

Evaluating Mortgage Payment Protection Insurance

The payment protection insurance (PPI) sector, of which mortgage payment protection cover is one along with income protection and loan protection, is still under review by the Competition Commission until February 2009 as well as the Financial Services Authority. Problems with the sector have been in the spotlight since 2005 and while some changes have been seen for the better, many more clearly need to be made to make the product more transparent for the consumer.

Mortgage payment protection insurance (MPPI) can give you an income if you should lose your own to ensure you would still be able to meet your monthly mortgage repayments, stopping you getting into arrears and losing your home to repossession. If you were to come out of work after suffering from an illness, having an accident or being made unemployed and you were to be off work for any length of time you would have the added worry of where to find the money each month.

Providing your circumstances meet those of a policy then it could begin to provide a pre-defined tax free income once you had been continually out of work for between 31 and up to 90 days. Once the cover had commenced then it would continue to give you security for up to 12 months and with some policies for up to 24 months but it has to be suitable for your particular circumstances because as with all insurance there are certain exclusions.

Some of the most common to all payment protection products are being self-employed, retired, suffering a pre-existing illness or only working part time. Of course there can be many more depending on the provider and you have to check them out in the small print of the policy before buying. The more ethical standalone specialist providers will make sure that they give you the key facts of a policy and are aware of the exclusions. The majority of mis-selling of payment protection was with the high street lenders who don't have the knowledge of selling the products and who sell them alongside mortgages and loans, the specialist will always ensure you have the information needed and offer the cheapest premiums for mortgage payment protection cover.

Although faith in what could be a lifeline has dropped considerably which has left many homeowners at the risk of losing their homes, it can be a very valuable asset to have if the product is right for your needs and it shouldn't be forgotten that it isn't the actual product that is to blame but rather those who sell it. It is the poor selling techniques which have to be avoided not mortgage payment protection cover itself.

The cover shouldn't be taken out alongside the mortgage but should be bought with an independent specialist; just as you wouldn't buy fish from the butchers you shouldn't buy such an important product as mortgage protection from the wrong place. If you go with a specialist and take their advice which is based on experience then mortgage payment protection cover will do the job it's supposed to do and that is to give you the protection of keeping the roof over your head.

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