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The Pros and Cons of Using a Mortgage Broker in Leicester

As could likely be predicted, we personally feel like there are some really great reasons why you should use a mortgage broker in Leicester. This isn’t born out of bias, however, as we understand there are pros and cons to both, no matter if you’re a first time buyer in Leicester, looking to remortgage in Leicester, or have another situation.

Regardless of if you’re going via a branch or online, you are still able to go direct to the mortgage lender yourself. Below are all the pros and cons to either of your options.

Pros & Cons

When thinking about going direct to a bank or building society, the first thing that springs to mind is that you won’t be required to pay a broker fee, which in turn would possibly save you money. In the past, another positive that people thought of was “the bank manager knows my finances inside out”, though after credit scoring systems were introduced, this no longer became a factor.

On top of this, some mortgage lenders will have exclusive mortgage products on offer, that can only be obtained by going direct. They offer these as a way of attracting a good spread of business from their consumers and other brokers, turning exclusive products on and off whenever they believe it to be necessary. On the other side of the coin, some products may only be accessible by going to the broker and not by going direct to the lender.

From 2014 onwards, lenders were restricted from selling their mortgages on a non-advised basis to any customers of their services (those with bank accounts, for example). Up until that point, some applicants felt like members of staff who were not qualified for giving advice, were pushing their services on them.

They also felt like they weren’t able to benefit from some of the consumer protection that would normally come with mortgage sales performed by professionally trained mortgage advisors in Leicester.

The changes took a long while for lenders to come to terms with and towards the back end of 2014, it was not uncommon for customers to have to wait a long time to get a mortgage appointment. This is unfortunately still the case today sometimes. When you have had an offer accepted on a house, this is the last thing you need or want!

Because of the issues present with going direct, much like the wait for an appointment, more and more applications were made with mortgage brokers who could freely offer a same day service, something we are able to do ourselves. When you get in touch with us, we get you booked in with a mortgage advisor in Leicester as quick as we can, either on the same day or at your earliest convenience.

Affordability is an important factor too, as the quality of a lenders deal won’t matter if you have no way of affording it. Buying a house is such a large step in people’s lives, that they often would rather get professional and personal advice from a qualified and experienced mortgage advisor in Leicester.

Handling Difficult Cases

Nowadays we find that a lot of mortgage applications aren’t as simple anymore. For whatever reason it may be, there are so many things that can make a case more complicated. Some examples of these are:

  • Mixed source of deposit (savings/gift)
  • Poor credit history
  • Let to Buy (keeping your current house and buying another)
  • Affordability
  • Contract workers/zero hours contracts
  • Self-Employed Income

In the past, mortgage lenders were able to stand head and shoulders above the competition by simply offering a deal that was similar to one offered by another lender, but with slight differences to make it more appealing. Fast forwarding to where we are now and it is all so much more different, with lending criteria being the difference maker between deals and lenders.

An example of this, is that some lenders may lend more than other lenders might have to Self Employed applicants. Some also take a more sympathetic view on previous discrepancies that are showing on your credit report.

Your situation will be unique to you. It may be similar, but it will never be the same as another case. When you explain your position to an experienced mortgage broker, it is highly likely that there will at least be at least something similar that we have encountered before, allowing for a more personalised service. Hopefully, our hard working mortgage advisors will be able to get you a favourable deal with good interest rates.

It’s more than just getting a mortgage though. Even if the application itself is fairly easy, our customers who are first time buyers in Leicester rely on our experience and knowledge for more insight into the mortgage process.

For example, we are able to sit and discuss how much they are going to offer on the property they are buying. From there, our team of mortgage advisors in Leicester can recommend our customers other necessary professional services such as solicitors, whilst also explaining the different types of property survey and protection that is available to them.

Responsive Service

One of the main pros of using a mortgage broker in Leicester, we believe, is that we are a lot more responsive than the mortgage lenders have been known to be. Our team work from early until late, all throughout the week (including out of hours), dedicated to our customers and ensuring the process is as speedy and stress-free as it can be.

Something that does get overlooked from time to time when looking at why customers may prefer to use a broker, is that everyone nowadays everyone has such a busy schedule. You might need a mortgage but don’t have the required time to sort it out. In these cases, your mortgage advisor can take the weight off your shoulders and work through it for you.

Professional applicants especially will see the benefits of this service, as they have clients of their own that they charge out their services to and often don’t have the time to work through it themselves. The customers we deal with regularly appreciate the benefits of having an expert on their side.

Perhaps in the future we’ll see lenders wanting to limit their links to brokers and wanting to take their business back. If this does happen, we don’t see it being likely that they will hire more staff in their branch networks. The future of all industry seems to be based around technology and the mortgage market may very well be heading this way too.

That may work for customers who are more than happy to do business with a “robo-advisor”, especially for cases that are easy and don’t require a thorough analysis. For the majority of people, however, there’s an element of “realness”, that “human touch” that can’t be obtained by going this route, and can only be found by speaking to a real mortgage advisor in Leicester.

To find out more information on our service or to present any mortgage queries that you have, please Contact Us and we’ll book you in for an appointment with a mortgage advisor in Leicester as soon as we can.

Right to Buy Mortgage Advice in Leicester

Mortgage Advisors in Leicester

If you are based in Leicester and living in a property owned by your local authority (that means your local council or housing association), you may have the opportunity to buy your home through use of a Right-to-Buy in Leicester.

The Right-to-Buy Scheme, providing you have the eligibility to do so, allows you to buy a property at a discounted price. This means that instead of paying a particular amount in rent to the owner for a property that isn’t yours, whilst the monthly mortgage payment may vary, you are able to truly call it home.

If you are new to the Right-to-Buy Scheme in Leicester or are confused about anything we mention here and would like guidance, please Get in Touch with our dedicated mortgage advisors in Leicester. They’re readily available throughout the day to answer any questions you may have.

Right-to-Buy Mortgage Advice to Buy Your Rented Home

We have a lot of experience in working with Right-to-Buy mortgages from our many years in the industry. As such we know how it works like the back of our hand and will be able to talk you through the process.

If you have no prior knowledge of the Right-to-Buy Scheme in Leicester, i.e., this is the first you’ve heard of it, it might be worth your time contacting your local authority to check whether or not you’re eligible to buy your rented home.

Once they have confirmed eligibility, you should receive a Right-to-Buy an offer from them, highlighting what the prices of the property will be when the scheme is in place and ready to go. The offer usually holds an expiry date, so you will need to speak with a fast & friendly mortgage advisors in Leicester in plenty of time before that period ends.

After you get in touch with us, we will book you in with a free initial mortgage consultation, taking account of your details so that we can understand your situation. You’ll speak to an experienced and dedicated advisor, who will hold your hand through the process.

How do I find out if I qualify for a Right-to-Buy discount?

To qualify for the Right-to-Buy discount, you should have been living in your rental property for three years, whether this is three years continuous or not.

The Right-to-Buy discount won’t be available to you if any of the following apply:

  • The property in question is not your main home.
  • You share facilities, i.e., a house share.
  • You’re on an introductory tenancy.
  • A court order got issued asking you to vacate.
  • You’re subject to an undischarged bankruptcy.
  • There are creditors that you owe outstanding money.

Exceptional living circumstances may also not be accepted, e.g., selected housing for the elderly or if you have a career in a specific sector.

The Different Types of Mortgages Explained in Leicester

The different types of Mortgages in Leicester we provide

When you start your mortgage process in Leicester, you will come to realise that there are lots of different options available to budding homeowners and existing homeowners alike.

Whether you’re a First-Time Buyer looking for your first home, are Home Movers looking for your next home or are looking to Remortgage in Leicester, there are many different routes you could take.

This article will cover a list, alongside related videos, of the most popular types of mortgages available on the market to customers. If you have any further questions mortgage-related, then please do not hesitate to contact us and speak to one of our dedicated Mortgage Advisors in Leicester.

What is a Fixed-Rate Mortgage?

A fixed-rate mortgage means that your mortgage payments will remain as they have been for a set period. You can set the length of the fixed term yourself, with common options typically being 2, 3, or 5 years or longer.

No matter what happens to inflation, interest rates, or the economy, you can rest assured that your mortgage payment, usually your biggest outgoing, will not change at any point during your term.

Fixed Rate Mortgage Explained | moneymanTV

What is a Tracker Mortgage?

A tracker mortgage means that your interest rate will follow on with the Bank of England’s base rate. This means that the lender that you are with does not set the rate themselves.

You will be paying a percentage above the base rate of the Bank of England. To provide an example of this; if the base rate is 1% and you are tracking at 1% above base rate, that means you will be paying a scale of 2%.

Tracker Mortgage Explained | moneymanTV

What is a Repayment Mortgage?

When you take out a repayment mortgage, you are paying capital and interest together. So as long as you keep your payments going for the full length of the mortgage term, the mortgage balance is guaranteed to be paid off at the end, with the property becoming yours.

It is the most risk-free way for your capital to be paid back to the lender, in the early years it is mainly the interest that you are paying, and your balance will go down at a slower rate, especially if you have taken out a 25, 30, or 35-year term.

This situation will switch up in the last ten years or so of your mortgage, where your payments are paying off more capital than interest, and the balance will come down at a much quicker rate.

Repayment Mortgage Explained | moneymanTV

What is an Interest Only Mortgage?

While many Buy to Lets in Leicester get set up on an interest-only basis, it is much more challenging to get a residential property on that same basis.

It is a lot less likely for lenders to offer an interest-only product nowadays. However, there are certain circumstances where this may be a viable option.

These include downsizing when you get older or having other potential investments that you will use to pay back the capital. Lenders are being a lot more stricter when it comes to offering these products now, and the loan to values are a lot lower than they once were.

Interest Only Mortgage Explained | moneymanTV

What is an Offset Mortgage?

With an offset mortgage, the lender will set you up a savings account alongside the mortgage account you have with them.

This works in a way where, let’s say you have a mortgage balance of £100,000 and £20,000 gets deposited into your savings account, you would only pay interest on the difference, so in this case it would be £80,000. It can be a very efficient way of managing your money, especially if you pay higher rates of tax.

Offset Mortgage Explained | moneymanTV

Mortgage Payment Holidays | Mortgage Advice in Leicester

Mortgage Payment Holiday Advice in Leicester

At the start of the Coronavirus pandemic, the Government promised that all borrowers would be allowed a three-month mortgage payment holiday if they needed it. Most lenders followed the Government’s guidelines and did their best to help out their borrowers during these hard few months. 

We feel that it is best, to sum up, what mortgage payment holidays are, what lenders are doing, and who can deliver you with help and advice through these next few months. 

What is a Mortgage Payment Holiday?

Mortgage payment holidays are an agreement entered into with your bank, building society or mortgage lender to defer your monthly mortgage payments for a set period. In this case, 3-months.

It does not mean you never have to pay the amount back, but the interest you defer gets added back onto the loan amount, while your capital balance will not decrease. In other words, your mortgage amount will increase slightly, and you will continue to attract interest on the whole amount.

When you are ready to continue the payments, this could mean that either your monthly payments recalculated at a slightly higher level or your mortgage term increases to some extent.

Most lenders will probably prefer not to extend your mortgage term as this could take you past their standard retirement ages, but the detail on this will follow in due course.

Dependent on your mortgage deal, you may be able to pay off a lump sum later in the year to bring your mortgage back to where it would have been.

Mortgage Payment Holidays are available both for those with residential or Buy-to-let Mortgages in Leicester, which means landlords also have assistance if rental payments are affected.

What is the Government Proposal?

The full proposal is in detail below:

  • Mortgage lenders will offer an automatic 3-month mortgage payment holiday for customers impacted, directly or indirectly, by COVID-19.
  • The mortgage payment holiday will apply to customers who are up to date on their payments, not in arrears, and wanting to self-certify that COVID-19 impacts them.
  • Meaning that lenders will not complete an income and expenditure assessment, or evaluation of alternate payment options as ordinarily required under MCOB.
  • This proposal will allow lenders to be more responsive to customer needs and offer forbearance in a simple way to customers in an environment where COVID-19 also impacts the operation of collections teams made.
  • Customers will be made aware that interest will accrue in the holiday period, and they will need to make up deferred payments in the future.
  • Customers who wish to undertake a full assessment of their ability to pay or financial difficulty may still do so.

How do I apply?

We would recommend speaking to your Mortgage Advisor in Leicester. They will asses your financial situation first before looking to defer your payments as your situation may not yet be pressing.

Approaching a Mortgage Broker in Leicester like us will allow you to explore all of your current mortgage options and could make things feel a lot less stressful.

For a customer, up to date with payments, not in arrears, and impacted by COVID-19:

What does this mean for my Credit Score?

In some cases, a mortgage payment holiday can harm your credit score, but most lenders have now said that for matters linked to the virus, they will ensure that this is not the case.

You must ask this question to your lender directly and record the response, including the date and the name of the person you are speaking to avoid confusion later. Different lenders are doing different things.

Will I still be able to Remortgage or take a Product Transfer with my lender?

At first, everything seemed like it would remain the same, and you would still be able to make changes to your mortgages as usual. Leading to a change over in the last couple of days, and lenders have been asking borrowers to avoid making changes while you are within a mortgage holiday period. So, at the moment, they are not allowing mortgages and product transfers.

Borrowers nearing the end of their existing product could get compelled to move on to the higher lenders variable rate, which means that borrowers who act too early could find themselves on a mortgage payment holiday that accrues interest on a costly variable rate.

We would highly recommend speaking to your Mortgage Advisor in Leicester, and they will determine the best course of action based on your personal and financial situation. If possible, arranging your mortgage transfer first then asking for the holiday would seem to be the most sensible way forward.

My Mortgage got Offered Will my Lender Withdraw the Offer?

At the moment, no Lenders have withdrawn mortgage offers; in fact, some are extending offers past the standard six-month expiration date. 

Should I Pull out of my Purchase?

You should not pull out of your purchase unless, for example, you are worried about losing your job as a result of Coronavirus. We are advising everyone to proceed as usual for now and “wait and see” – you are not committed to completing your purchase until contracts get exchanged.

What “Other Options” are available?

In some cases, lenders can offer you a temporary switch to interest-only to reduce your monthly payments but not to add any further to the loan amount by still servicing the interest payments each month.

It may not be necessary to convert all your mortgage to interest only, and it may be that putting part of the mortgage on this basis could give you the breathing space you need.

People with savings may find that remortgaging onto an offset basis could give them a helping boost they were looking for, and they will be cutting down on their monthly payments while keeping hold of their savings.

For example, someone with a £400,000 loan and £100,000 in savings would only pay interest on £300,000. Meaning their monthly mortgage payments will massively be reduced.

For others, a straight remortgage to another lender, calculating the cost of any early repayment charges, may well be enough to ease the burden or simply extending the term of your mortgage.

If you still have any other questions on mortgage payment holidays or just want general Mortgage Advice in Leicester, give us a call today. We want to help you and your mortgage journey through these tough few months ahead. Speak to an experienced Mortgage Advisor in Leicester today.

First-Time-Buyers at Highest Level since 2007

UK Finance from June 2019 | Mortgage Advice in Leicester

This insight provided by UK Finance from June 2019. The overall number of First Time Buyer in Leicester is still increasing meaning numbers are topping numbers from when they were at their highest in 2007, before the Credit Crunch.

External economic factors such as Brexit are sometimes less likely to deter first-time buyers than Home Movers in Leicester. It is also apparent that Home movers are never normally 100% certain that they ought to move.

So when you add in extra factors such as political uncertainty it’s completely natural for them to say, “Let’s just wait and see what happens”.

Things are more straightforward for first-time buyers. The hard bit is the deposit but if this is available then the choices are clear-cut, they can either:

  • Continue living with parents.
  • Rent a property.
  • Buy a property.

What else did they find out?

Most of our customers often go down the more popular route of buying, the number of First Time Buyers has increased by over 130% when reviewing statistics from the past ten years.

This is because more options such as the 95% Mortgages are more available and there is also further access to Help to Buy Equity Loan Mortgages.

Over half of all homes purchased with a mortgage consist of first-time-Buyers with the remainder being Home Movers and Buy-to-Let in Leicester Investors.

The last time first-time buyers had more than 50% of market share was in 1995 when only a small number of Buy to Lets were taking place. The percentage of first-time buyers has been rising nicely for almost 20 years.

When reviewing properties in terms of value, homes in the North East of England the homes seem to hold the lowest in value. The average sits currently just shy of £140,000.

How we can help? | Mortgage Broker in Leicester

We have found that first-time buyers really value trusted advice from a Trusted Mortgage Broker. It’s not just simply about finding the cheapest deal.

We understand their appreciation of having support available whenever it is needed when in the process of buying their first home. They want straightforward advice.

What protection insurance to buy, the right amount to pay for a deposit, and many more questions.

We love helping First-Time Buyers in Leicester achieve their goals and we’d love to hear from you, feel free to contact us for a Free Mortgage Consultation to find out more.

How to Improve your Credit Score in Leicester today

Way to improve your credit score | moneymanTV

Mortgage Advice in Leicester

Without a doubt, we recommend that everyone should spend time to manage to boost their credit score. The higher your credit score, the more chance you have of your mortgage application getting accepted. No one is guaranteed to get approved, and different Lenders have their internal scoring systems.

Following we advise everybody like a First Time Buyer in Leicester, to not worry if you fall short with one Lender. Contact us and Speak to one of our Mortgage Advisors in Leicester their job is to match you to the correct Lender that suits your circumstances, end of the day we both want the same outcome to get you the best deal available.

Different reference agencies

We recommend going to ether Experian and Equifax. It’s a good idea to use multiple agencies to get an average of the numbers for your credit score. Just using one agency might hold incorrect data. Checking with several agencies will help you identify any such discrepancies.

There are some excellent practices listed below regarding things you can be doing to improve your credit rating:

Avoid unnecessary credit searches:

Firstly multiple credit searches can harm your score. Be careful when using price comparison websites, which are significant culprits of credit searching on individuals. However you know you want to apply for a mortgage soon, it is wise to avoid using it for any other credit. While having some credit and paying it back is a good thing for your score, in the long run. In conclusion, Lenders do not like to see you increasing your borrowings just before making a mortgage application.

Are you on the Voter’s Roll?

Being on the electoral roll adds many points to your score. It indicates stability and Lenders like that. Ensure your name spelled correctly and that it’s your current address, not an old one. However, if you are not registered, it’s easy to do so online.

Don’t Run Close To Your Maximum Limit

If you max out your card each month, that will reduce your score. Using a credit card and paying off the balance in full each month is preferable. Not to mention, it is indicating that you are good at managing your money. Worst of all would be exceeding an agreed card limit or overdraft. Lenders want to know that you take your finances seriously.

Check your address history Is keyed correctly

Quite often, it can appear that you are living in two places at the same time on your credit report. Maybe you had forgotten to tell one of your credit providers that you have moved to a new house. Check all addresses have been spelled correctly. If you have lived in a flat, this can be tricky as the flat/apartment number can get formatted in different ways.

Close Down Any Unused Credit Accounts

You should contact the providers of store/credit cards you no longer use and get the account closed. In the short term, this can harm your score briefly as the credit reference can’t tell if it’s you closing the account down or the provider. However don’t worry, it’s one step back to take two forward. Another good thing to do to reduce your chance of falling victim for fraud should you not notice you have lost a card you don’t use regularly.

Remove Financial Links to others

If you have a family member or ex-partner connected to you, then this could be affecting your score. You won’t be able to get the financial association removed if the account is still live, in any case. To remove one of these links, you should contact the credit reference agencies and make a request.

Furthermore, many consumers had felt that credit scoring is an ‘unfair way’ of Lenders assessing applications. Lenders feel differently. It is much cheaper for them to operate this way.

Send an up to date copy of your credit report to your Mortgage Advisor upfront, and you will increase your chances of being accepted the first time. The more your Advisor knows about your finances, the better. There are still some smaller Lenders out there that do not credit score. These Lenders do it the old-fashioned manual way, they will always have specific rules about the number of defaults and CCJ’s they will allow.

Mortgage Advice in Leicester

Coronavirus & the Mortgage Market | Mortgage Advice in Leicester

Coronavirus impact on the mortgage market in Leicester

This article was originally published on 30th March 2020 and as of the 20th May 2020 the property market has now resumed and this information has become outdated. Everything was 100% accurate at the date that this article was published.

The mortgage market has endured thanks to the coronavirus. Everything has come on a bit fast, and we thought we should catch you up to speed.

Our intentions aren’t to scare you, but explain what has happened to the mortgage market and do our best to help you through the problems you may face during these difficult times.

Mortgage Surveyors

The central dilemma for the mortgage market is that surveyors and mortgage valuers can’t go out and visit properties because the whole property market is on hold. Lenders need to know what they are lending against, so require some sort of valuation before accepting your application.

Some lenders rely on AVM’s (Automated Valuation Model) for valuations on a property. The reason being it’s a way for lenders to receive an estimate without actually going out to the property.

However, when they don’t need to send someone out to look at the property physically, these types of mortgages get restricted and to lower loan-to-values only.

During the last couple of days, as of March 28th, some lenders have been restricting their maximum loan-to-value down to 60%. So, they are continuing to process these types of applications but not necessarily ones at higher loan-to-values.

A lender’s viewpoint

Each lender is taking a different approach. So far, no mortgage offers got withdrawn, and we think that it is just a waiting game at the moment, lenders are just putting everything on hold before rushing into accepting more mortgages.

We have whiteness that some lenders have decided to extend the periods of their mortgage offers from six months up to nine to allow the economy and the mortgage market to get back up and running again.

Mortgage Payment Holidays

Following our recent article about Mortgage Payment Holidays, we want to remind you that you should only take one if you need to. Do your research, talk to a Mortgage Advisor in Leicester, evaluate your options, and see whether it is the right thing for you.

It is more than likely that they will extend the period of your mortgage anyway, so it could be better just to hold off. You should contact your lender if you are questioning your ability to meet your monthly mortgage payments.

If you decide that this is your best option, lenders are asking for you to get in touch online due to the sheer volume of calls they are receiving.

If you are going to request a payment holiday, check that it won’t affect your credit rating or mark any arrears against your account. Also, don’t just cancel your direct debit and remember that you will need to seek permission from your lender to take a payment holiday.

Speak to a Mortgage Advisor in Leicester

The main thing is not to panic. We are here to help you with all of your mortgage problems and get you and your mortgage through these next couple of months. At some point in the coming weeks or months, someone is going to press play again.

We will all be back to normal in the given time. You can still get in touch with a Mortgage Advisor in Leicester from 8am – 10pm, 7 days a week. Business is as usual. We can’t wait for you to get in touch and help you with all your mortgage needs.

Life Insurance Advice in Leicester

Life insurance is designed to pay out, usually in a lump sum, in the event of death. With regard to your mortgage, the sum assured should be enough to pay off your outstanding balance.

Here is some information about the most popular types:

  • The whole of Life Insurance
  • Term Assurance
  • Family Income Benefit
  • Joint Life Insurance
  • Death in Service

Whole of Life Insurance

Whole of life insurance does not have an end date, therefore, providing premiums are being met the policy will pay out. 

Generally speaking, this type of insurance is used for family protection and also as part of inheritance tax planning. 

Term Assurance

Term assurance is the most popular type of family insurance used to cover a mortgage.

Our Mortgage Advisors in Leicester will recommend the sum assured and term of the policy, usually to run in line with your new mortgage. The providing that all premiums are maintained, the sum assured will be paid out if you were to die during the term.

There are various types of Term Assurance available, such as decreasing and increasing cover. As part of our personal protection review, the most suitable policy for your needs will be recommended.

Family Income Benefit

This is another version of Term Assurance, where instead of the sum assured is paid as a lump sum on death, it’s paid as an agreed monthly payment. This is very good for families looking to insure an income. Our Mortgage Advisors in Leicester will usually recommend a mixture of insurance types tailor-made to match your personal and family requirements.

Joint Life Insurance

If you are part of a couple, you could consider taking out a single life policy that will payout in the event of one of you dying.

This can be cheaper than paying the premiums on two separate policies, but bear in mind that joint policies only payout on the first death, after that the cover ends.

If you had two separate policies, the second policy would remain in force even after a claim had been made on the first.

Death in Service

Many companies offer their employees family a lump sum payment if the staff member dies while they are employed by the firm.

Although this doesn’t mean the death has to be at the workplace or in any way related to the job done.

This cover will most likely end as soon as you leave the company.

Our Insurance Advice Service

Giving our customers an equal opportunity to take insurance out through ourselves, is very important to us.

We’ll have a look at any existing policies you have in place with our free consultation and assess their suitability.

Then it’s our job to recommend which products meet your needs, including critical illness and income protection.

If required, we’ll then personalize the plan to match your available monthly budget. 

Click here to read our Mortgage Protection explained in Leicester.

What Is Mortgage Protection Insurance in Leicester?

Mortgage Advice in Leicester & Surrounding Areas

Mortgage Protection Insurance is a term used to encompass various types of cover designed to protect borrowers from events that could severely impact their ability to maintain mortgage payments.

There are different variations, but when connected to a mortgage in Leicester, they are all there to provide peace of mind and usually fall into the following categories:

• Life Cover
• Critical Illness Insurance
• Income Protection
• Accident, Sickness, Unemployment (ASU) Cover
• Family Income Benefit

Life Cover

As a rule, if the policyholder dies within the term, then the sum assured should be enough to pay off the outstanding mortgage balance and ensure the borrower’s dependents get left with a debt they might not otherwise be able to manage.

Our Mortgage Advisors in Leicester can run through all the different types of life cover and recommend the most suitable plan for you.

Critical Illness Insurance

There’s a debate that says that life cover gets taken for the benefit of other people – i.e., your dependents – because sadly, you won’t be around to see any interest yourself.

However, these days, thanks to improvements in the sort of medical treatment available, many people now survive conditions that once might have been fatal.

Nevertheless, while undergoing what may be long spells of treatment and recovery, it could have a marked effect on your ability to meet your financial commitments. The decision has led to the development of Critical Illness Insurance.

Critical Illness Insurance works similarly to Life Assurance in that it is usually taken for a specific term of years and can have different options such as level/increasing etc.

It gets designed to pay out a lump sum and, like Life cover, for borrowers, it is typically taken on a decreasing term basis in line with the reduction of your mortgage balance.

The key is that the benefit gets paid if you fall victim to one of some specified critical illnesses and pays out whatever the long term prognosis of that illness.

The type of illnesses covered vary from company to company, that’s why this type of insurance cannot be solely price-driven, and advice highly recommended.

In practice, many companies will offer Life and Critical Illness Critical cover as a combined policy.

They would usually payout on the “first event,” i.e., whatever happens first – either death or a serious illness – the payout gets made. They can also get written on a single or joint life basis.

Income Protection

Whereas Life and Critical Illness cover pay out a lump sum, “Income Protection” pays out a monthly amount designed to replace your wages in the event of you being unfit to work.

Unlike Critical Illness cover, there are no restrictions on the illnesses or injuries covered, the only factor being whether they make you unsuitable to work.

There are, however, restrictions on how much you can cover and how quickly benefits would start to get paid.

Like Life and Critical Illness cover, these policies are underwritten based on your health and lifestyle at the time you apply.

All income protection policies get written on a single life basis.

Accident, Sickness, Unemployment (ASU) Cover

Similar in many ways to Income Protection, these policies also cover you should you be made unemployed. Benefits are usually linked to your mortgage and other costs (rather than necessarily your wages) and would often be paid one month “in arrears” after a successful claim.

These policies get only underwritten at the time of an application rather than at the outset. Which can sometimes mean there can be some confusion/delay as to whether a claim would get met.

They are a useful safety net if you get made long-term unemployed, but be sure to check the details of how/when any unemployment benefits would get paid out, as it may be that you would have returned to work before any money becomes due.

Family Income Benefit

Probably the least common of the “mortgage protection” type policies but can often be valuable – particularly for those with young families.

The plans get taken to cover Life and/or Critical Illness and get underwritten on the application the same was we mentioned earlier.

However, unlike the traditional forms of policy, rather than pay out a lump sum, the cover would pay an annual or monthly income for the remainder of the term of the plan.

Thus it can replace the income of the primary breadwinner for several years, dependent upon a particular client’s circumstances and, because of this, would usually be written on a level or basis or an index-linked basis designed to keep up with inflation.

Summary

There’s an adage that says you can never have too much insurance. Indeed, many people have one or more of the different types of policy, and it would be wrong to think of Mortgage Protection Insurance as just an “either/or” choice.

However, in the real world, affordability plays a massive part, so while it would be fantastic to cover yourself for every potential opportunity.
A good Mortgage Advisor in Leicester like us will sit down with you and tailor the type of cover to be the most suitable combination to your family’s priority and budget.

If you do take more than one type of policy, however, your advisor would usually place all the cover with one provider.

To save you the additional policy administration charges which individual policies carry but which get reduced when bringing all the systems under one plan.

Please give us a call or fill out our enquiry form to speak with one of our Dedicated Protection Specialists.

Can I have a Second Mortgage in Leicester?

Here are some reasons you might need a second mortgage in Leicester?

Can I have two mortgages? | MoneymanTV
  1. Do you want a second mortgage to raise money for your existing home?
  2. Are you looking to rent out your existing home and purchase a new one?
  3. Are you looking to help your children out with a second mortgage?
  4. Do you require a second mortgage to purchase a Buy To Let Property in Leicester?
  5. Is your name on an existing mortgage, and you are looking to buy a new property?

Second Mortgage to Raise Money

If you have equity in your home and are looking for a second mortgage in Leicetser to release some of this to fund a purchase or something else, then we can help.

Quite often, at this time, if you are currently on a Lender’s standard variable rate, we can shop around and find a more competitive deal at the same time as releasing capital.

A further advance with your current Lender is also an option.

Second Mortgage to Rent Out Existing Home to Purchase a New one

If you are looking to move house but keep hold of your existing property with the view to let it out, we will be able to help.

Your second mortgage will be a new residential one. This type of move is known as the Let to Buy scheme in Leicester and is becoming increasingly popular in recent years.

Second Mortgage to Purchase a Home for your Children

If you are exploring the options available to you of helping your children or grandchildren with getting on the property ladder, there are now many products that we can run through to achieve this.

Second Mortgage for a Buy to Let in Leicester

If you are looking to purchase a Buy to Let in Leicester, we can help.

Named on Existing Mortgage and Want to Buy a New Home in Leicester

Are you currently named on another mortgage and would like to purchase a new property to move? The situation that we come across regularly especially due to divorce or separation and can often help.

Whatever your situation is to get a second mortgage, being an Experienced Mortgage Broker in Leicester, we can search 1000’s of mortgage deals on your behalf and recommend the most suitable product for you based on your situation.

Leicestermoneyman.com & Leicestermoneyman are trading styles of UK Moneyman Limited, which is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited registered in England, registered number 6789312 and registered office 10 Consort Court, Hull, HU9 1PU.

© 2021 Leicestermoneyman

Leicestermoneyman – 3 Oswin Road, Leicester, LE3 1HR

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