Despite the Government’s pledge to give extra help to mortgage holders who lose their jobs, a protection policy should remain an essential consideration for homeowners, according to financial research firm Defaqto .
The Department for Work and Pensions (DWP) has said that it is reforming the Income Support for Mortgage Interest (ISMI) system. The DWP says that from April next year, the benefit will cover the interest on the first £175,000 of the mortgage after 13 weeks of unemployment . At present, it only covers the first £100,000 and does not come into effect until after 39 weeks.
Brian Brown, head of insight at Defaqto, explained that while the reform represents good news for homeowners, they should not ignore the benefits of some protection policies, such as mortgage payment protection insurance (MPPI) .
Mr Brown said: "There is still the issue though of how you would survive if you lost your job. You will still need to repay the mortgage for the first 13 weeks of unemployment, and after that ISMI only covers the interest on the mortgage."
Protection still important despite Government support for homeowners
Financial Services > Income lnsurance > News
Protection still important despite Government support for homeowners
Tue, 09 Sep 2008
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