First-time Buyers

Mortgage lenders failing to offer protection

Your Mortgage
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Your Mortgage

Following findings that only 2.7% of new mortgage borrowers buy unemployment cover, it has been revealed nearly half of mortgage lenders are failing to offer it as an option.

Mortgage protection specialist British Money asked 1,000 new mortgage borrowers why they didn’t purchase cover; 46% said it was not discussed or offered to them by their lender so they didn’t know it was available, 27% thought it unnecessary as the state would protect them if they lost their job and 24% would never buy the product as it has a tarnished reputation. The remaining 3% purchased cover – in line with previous survey findings.

Simon Burgess, director of British Money, 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.”