Can I get MPPI setup before committing to mortgage/completing buying a house

comdw

I want to buy a house but I have some concerns about my job. Our company is in administration due to the parent company going into Chapter 11, though we are expected to come through it, likely being sold off at some point.

I want to have MPPI cover for obvious reasons, but can I guarantee I will be accepted before I have to actually commit to my mortgage or buying the house? How do I go about doing that?

dunstonh

You cant get an MPPI but you can get a PPI.

comdw

Thanks, would you mind elaborating on why this is? Can PPI cover mortgage payments, and cover them before I take out the mortgage? Not quite sure I understand the process still

dunstonh

MPPI is for covering mortgages and complies with the income protection requirements relating to mortgages. For example, in the event of a claim, if the income protection is paid direct to lender then it doesnt work against you for any benefits claims you have. It also cannot exceed a limited amount above your mortgage (typically mortgage plus 25%). If you dont have a mortgage then you cant set a figure. PPI has to comply with personal income protection rules (e.g. not exceeding a certain amount of your income). It is not limited to your current mortgage payment.

Can PPI cover mortgage payments

In a roundabout way. You set the amount of income you want protecting and they will pay that out in the event of a claim. If you set the figure to your anticipated monthly payment then it will effectively do the same thing. Although it may impact on benefits.

comdw

Thanks for clarifying this. My reading around this forum on PPI has suggested I would either never get accepted for it or be unable to claim in the event of being axed with the situation my employer is in.

So, definitely no way to get the MPPI at the same time as getting mortgage approval? I'm trying to avoid the situation where I'm refused MPPI after having completed on buying somewhere.