Mortgage Protection

ninimac

Hi there - need some help!

Myself and my partner are in the process of buying a house and need to sort out Mortgage protection and house insurance. We haven't a clue and any advice is very much appreciated!

My question is....Should we get mortgage protection for both of us or just one? I got a quote from Labrokers.ie - €193.15 per year for the two of us or €100 per year for just me. This this sound right? - we are both 26 non smokers and house price is 197000.

On house insurance - does this cover just the building which means you get seperate cover for contents or can the two be combined. Since we will be only buying "contents" after arranging the house insurance can we update the policy at a later stage to include contents?

Thanks a million:)

Baz_

since I'm the one buying the house with you, you would think that discussing it with me first would have been the way to go :rolleyes:

ninimac wrote:

My question is....Should we get mortgage protection for both of us or just one? I got a quote from Labrokers.ie - €193.15 per year for the two of us or €100 per year for just me. This this sound right? - we are both 26 non smokers and house price is 197000.

Why would you even consider getting it on just one, what if the wrong one of us dies...

Although in saying that, I will admit I don't have a clue how it works, so maybe there is a reason.

ninimac wrote:

On house insurance - does this cover just the building which means you get seperate cover for contents or can the two be combined. Since we will be only buying "contents" after arranging the house insurance can we update the policy at a later stage to include contents?

You can get structural insurance on its own. A friend in work here has structural insurance but no content insurance. I'm also pretty sure that the insurance companies aren't going to turn around at a later stage and refuse extra money from you for contents insurance if you didn't have it from the start. They are known to be quite greedy after all.

As for whether or not the two absolutely must be bundled together if you have them both, I don't know about that either.

ninimac

If I had of wanted your opinion - I would have asked it

Only joking - sorry just haven't had a chance to talk to you about it yet! Maybe the amount of OT you've been doing lately has something to do with that!

Seriously though thanks for the input:rolleyes:

Western_sean

First off this is just how I'd think about it I'm not giving you any kind of advice - what you ultimately choose to do is your own business.......

If you are going to need both incomes to pay the mortgage then you need mortgage protection for both parties really. Depending on your circumstances you could choose to split the covers so that only the portion of the mortgage supported by one income is repaid in the event of that person passing on.

You should consider the effect of serious illness or disability for either of you on your ability to repay the mortage in the medium term.

The quote sounds about right.

If I was you I'd go talk to a broker the advice is free and they should come up with something around the same price as labrokers.

Sean

jayok

Jeez, a domestic already and you haven't even bought!

But seriously - if you are buying the house as a principal private residence (PPR), that is you are going to live there and not rent, the lending agency will require (it's actually a legal requirement) that there is mortgage protection in place. The policy may not have to be assigned to the lender, but it must be in place.

As such if you are drawing down the mortgage in joint names you will need life cover for BOTH parties. Such that should one die then the mortgage will be cleared. In the event of both parties dying the mortgage will also be cleared.

House Insurance is another matter again. This is the insurance that covers the structure and it's contents. Equally if your loan is secured against this property, and in 99.999% of cases it is, you will need to have house insurance in place. However, the cover required here is not normally the purchase cost of the house, but more the rebuilding cost of the house (in the event of a complete fire) so if you're buying for €197,000 is might only cost (this is a guess) cost €125,000 to rebuild. When getting a mortgage the bank will get a valuer to determine this - ask the bank for the figure. The standard contents cover is then a percentage of the overall sum insured (e.g. 25% of €197,000 or €50k)

So basically at a minimum you need

1. Mortgage Protection (Life Cover) for €197k for both of you
2. House Insurance on the property to cover rebuilding costs

Other insurances such a Mortgage Protection Payment, Critical Illness, etc depends entirely on your cirsumstances and are better dicusses between yourselves (probably not on boards.ie though )

BTW When you say partner (i.e. not married) I assume you have spoke to the solicitor about the purchasing agreement, i.e.Tenants in Common, estate, etc, etc.

Best of luck.

Padraig Mor

ninimac wrote:

Hi there - need some help!

Myself and my partner are in the process of buying a house and need to sort out Mortgage protection and house insurance. We haven't a clue and any advice is very much appreciated!

My question is....Should we get mortgage protection for both of us or just one? I got a quote from Labrokers.ie - €193.15 per year for the two of us or €100 per year for just me. This this sound right? - we are both 26 non smokers and house price is 197000.

On house insurance - does this cover just the building which means you get seperate cover for contents or can the two be combined. Since we will be only buying "contents" after arranging the house insurance can we update the policy at a later stage to include contents?

Thanks a million:)

You need the protection for both of you. I highly recommend www.123.ie for both sets of cover - in particluar, if you pay for the first year upfront there are significant savings to be made (like 50%!).