A policy would begin to pay an income if you should become unemployed by such as being made redundant. It would mean that you would get the tax-free income you insured against when taking out policy. With this income you would have the money needed to be able to continue meeting the repayments of your mortgage without worry. You would not fall behind into arrears and have to meet the lender to make an agreement to catch up while at the same time continuing with the repayments of the mortgage. Of course without an income making any agreement with the lender would be very hard if not impossible. This means the lender would have no option but to take you to court to seek repossession of your home and you would be given an eviction order.



The Council of Mortgage Lenders has recently announced that repossessions could rise this year to 45,000. In just up to June this year already there have been over 18,000 repossessions. Perhaps many of these could have been avoided in payment protection had been taken out. However with some lenders charging high premiums for mortgage protection many consumers cannot afford to take a policy. Particularly as many homeowners are unaware that they have a choice of taking out the cover independently with a specialist in payment protection.

By choosing to take mortgage protection against unemployment with a specialist payment protection provider you are able to make huge savings on the cover. Age based cover means younger first time homebuyers can now afford to take out a policy and cover the huge borrowings they stretch their budgets with. Premiums are also based on the amount of protection you want.

There has been a lot of controversy over payment protection in the past. The Financial Services Authority revealed that cover had been mis-sold in 2005 and fines were handed out. It was found that protection had been sold to those who could not hope to claim against it and the cost of protection was sky high. However when bought with the exclusions in mind and having checked them against your circumstances your policy can work in the way it was designed to work. All ethical providers will make you aware that there are exclusions before you take out a policy. They will also provide you with adequate information so that you are able to decide if cover is suitable for your needs.

Mortgage protection against unemployment would begin to provide you with an income between days 30/90 of you being unemployed. The policy would then give you a pre-determined amount of time to find work and then it would cease. This is generally between 12 monthly payouts and 24, however in the majority of cases this is more than enough time to find another job and get back to earning a living again. You can for additional cost also choose to cover against losing your income to accident and sickness.