Mortgage Payment Protection
If you have a mortgage then it is likely, when you arranged your loan, that you were sold mortgage payment protection cover. This type of cover can be known by a number of different names including accident, sickness and unemployment cover and MPPI. Whatever the name used it is, in essence, the same product.
The purpose of this kind of insurance is to protect the borrower by insuring their debt repayment against involuntary unemployment. The cover can be expensive and may cost in the region of 13%-25% of the base mortgage value. On a mortgage of £200,000 mortgage payment protection may cost between £26,000 and £50,000. This amount will usually be added to the overall mortgage debt and will attract interest at the same rate. It can, therefore, significantly increase the overall debt and the repayment period.
In addition to the costs mortgage payment protection, in common with other types of PPI, also has quite a high number of exemptions. These are circumstances and situations that will not be covered by the policy. Unfortunately, many people were not made aware of the full cost of their policy or the conditions attached at the point of sale. As a consequence, many have either found themselves facing a much higher debt than anticipated or, in the worse cases, trying to use their policy only to find they have no coverage. The good news is, if your lender gave you incorrect, incomplete or misleading information regarding your mortgage payment protection policy it may be considered to have been mis-sold.
Where mis-selling is established a customer can usually expect to get a full refund of premiums paid and, in some cases, additional interest. If you believe your policy was mis-sold and would like assistance making a claim, complete our quick claim form on our homepage.