Mortgage Payment Protection Insurance

Mortgage Payment Protection Insurance (MPPI) is a scheme where for a premium companies will pay your mortgage for a certain time frame.

It is advisable for people to take out insurance for mortgage payments so that the risk of home repossession is reduced.

When you take out a mortgage, most mortgage lenders will offer mortgage insurance plans. Usually this is optional. If you already have a comprehensive sickness protection plan, it may be unnecessary to take out mortgage insurance. This is because your sickness protection plan should give enough income to pay for the mortgage, especially if interest rates are low. However, a sickness protection plan may be insufficient if we entered a period of high interest rates causing your mortgage payments to take up a high % of your sickness protection payments.

Getting Best Deal on Mortgage Insurance.

It is often most convenient to take out mortgage insurance with your mortgage lender. But, these are often not the cheapest, they take advantage of the fact that customers are too lazy to look for cheaper products. If you look around at independent mortgage insurance providers you will probably find a better deal.

Most payment protection plans will be cheaper if you have a longer period before the payment starts. For example, if you agree to a two month delay before the mortgage protection starts, premiums are likely to be lower. If you take this option, it is good to have sufficient savings to make this possible.

Related