News

Apr 25

Can’t Work? How will you pay the Mortgage?

According to Aviva, around 65% of the population lack financial protection if they die or face a critical illness.

Restricted Sick Pay Won’t Pay the Mortgage

An incapacitating illness or accident could leave a homeowner unable to work for many years, and during that time sick pay could be seriously restricted meaning that savings will diminish extremely quickly; especially if medical care or complementary treatments form part of the expenses.

Redundancy could Threaten Mortgage Repayments

And these days, with the threat of redundancy seriously heightened, many mortgage payers are finding themselves in a situation where their salary has disappeared and there is no way of meeting the repayments whilst they face the arduous task of seeking alternative employment.

Geoff Charles, Managing Director of Bower Mortgage Company, says that in his experience, most homebuyers realise the importance of taking out life assurance to make sure their family is not left financially stranded should they die, but far fewer consider protecting their mortgage repayments in the event of long term illness or accident, or indeed redundancy.

Unable to Work: How will the Mortgage be paid?

“All of a sudden finding yourself unable to work and bring home the salary to which your family has become accustomed can have serious connotations,” says Geoff. “Mortgage repayments still need to be made, utility bills paid and living expenses met, and an illness or accident that leaves you dependent on minimal sick pay, if any pay at all, could spell serious difficulties. Redundancy will bring similar issues; and all at a time when money worries should be the last thing on your mind.”

The word ‘struggle’ can easily be associated with those who decide not to take out adequate mortgage protection insurance. AXA says the average age at which people claim for critical illness cover is 43 for a man and 40 for a woman; times of life associated with high expenses.

The answer? Seek advice from your mortgage broker on a suitable mortgage protection insurance policy that will cover you in the event of being unable to work due to illness, accident or redundancy. Geoff Charles says, “We always urge our clients to take out adequate mortgage protection insurance because our overall aim is to make sure our clients can repay their mortgage and continue to enjoy the homes and lifestyles they have become accustomed to.”

Your home may be repossessed if you do not keep up repayments on a mortgage or any debt secured on it.

Bower Mortgage Company: FSA regulated UK-wide mortgage advice from friendly, qualified, experienced mortgage planning specialists. Quality, face to face advice and a strong focus on building long term customer relationships. For money saving mortgage and mortgage protection advice, contact Bower on 0800 411 8668 or e-mail info@bowermortgagecompany.co.uk.