Are these mortgage and life insurance quotes silly?

GreyKnight

Hi folks

I am about to go ahead with a £99k mortgage from Barclays/Woolwich as a first time buyer and obviously they have given me some quotes for a few insurance schemes. Can the experts here tell me whether they are senselessly expensive or not? (I think they might be). I am single with no dependants.

1) Barclays Mortgagecare Insurance (mortgage payment protection insurance).

Basically my monthly mortgage payments will be £617 a month fixed for 3 years. Barclays have quoted to cover me for £742 a month (I guess to cover maintenance payments too etc etc). They will cover your mortgage payments for a period of 24 months deferred for 2 months. The premium quoted is £44.14 a month. I know that the 24 month period of payouts is unusual (most are 12 months max), but the premium still sounds a lot.

2) Mortgage term life assurance & Critical Illness (from Legal & General)

To cover a period of 30 years I have been quoted £36.80 per month.

3) Contents insurance from Barclays insurance (not including buildings insurance)

£19.59 per month over 10 months per year with £100 excess.


So basically I am sure that these are inflated charges because they're hoping I will just accept them. I'm guessing that legally I don't have to choose any of these from Barclays/Woolwich? Will it affect my application at all if I don't though?

Thanks folks

G

Wutang_2

GreyKnight wrote: »

So basically I am sure that these are inflated charges because they're hoping I will just accept them. I'm guessing that legally I don't have to choose any of these from Barclays/Woolwich? Will it affect my application at all if I don't though?

G

No you don't have to and no, it will not affect your mortgage application - speak to an IFA - and why do you think they are inflated?

dunstonh

Bank life assurance figures are more expensive. Everyone knows that but people still buy it.

They are not allowed to adjust a lending decision based on whether or not you buy insurances.

dacouch

The home insurance does look expensive, speak to a local broker and speak to an IFA about the other matters as dunstonh advised.

Remember your mortgage is for 25 years so if your paying justr £10 extra a month in total on these policies it would add up to £3000 over the life of your mortgage

GreyKnight

Thanks guys.

Well I think they are inflated because I can get a mortgage protection plan on the web for just £16.50 a month, a life assurance critical illness and unemployment policy for £23 a month and contents insurance for £6 a month (all from providers recommended by MSE).

Overall a saving of £50 a month (and yes I have read the small print to make sure I'm comparing like for like.)


My initial mortgage term will be 35 years to keep initial payments down, but I will reduce the term I expect (or overpay) to minimise long term costs.

koexelek

Wutang wrote: »

No you don't have to and no, it will not affect your mortgage application
It shouldn't, but I would not be so sure. I hav heard of banks and building societies blackmailing borrowers to take their expensive insurances " or the mortgage will get refused"Best to say yes to everything up until you get your formal mortgage offer.... then say thnks but no thanks and get better deals from an IFA instead