Mortgage lenders fail to offer protection


Adverts target benefit over-payment

Nearly half of mortgage lenders are failing to offer mortgage protection insurance, British Money director Simon Burgess has claimed.

A survey of 1000 new mortgage borrowers found that 46% said the cover was not offered at all.

The research by online market research firm Usurv, found that 27% of borrowers thought the cover unnecessary as the benefits system would protect them if they lost their job. Some 24% would never buy the product as it has a tarnished reputation. The remaining 3% purchased cover.

The survey findings tally with other research that recently reported that only 2.7% of people taking out new mortgages and 5.4% of existing borrowers have financial cover to ensure continuity of their payments if they become unemployed,

Protection specialist, Simon Burgess, said: "These figures are astounding. Why are so many mortgage lenders shying away from offering the very products that will prevent customers from amassing debts and enable them to keep their homes during times of hardship?

"It doesn't make sense - lenders are asking borrowers to jump through hoops to evidence they can meet their financial commitments before offering a mortgage but are not offering support mechanisms when they can't."
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