First time buyer, mortgage and insurance??

christineg79

Hello,

I am a first time buyer who has had an offer accepted on a house. I have sorted a solicitor and applied for a mortgage.

My mortgage provider is asking for my insrance details for home/content and life. I am planning to sort these independently as much cheaper than going through the mortgage advisor but at what stage do I take them out as the mortgage provider is asking for details. All I have at present is quotes but wasnt going to take them out until I knew I date when I would be moving? Im confused what is best to do?

Thanks for any advice!

Andrew_Cottrell

christineg79 wrote: »

My mortgage provider is asking for my insrance details for home/content and life. I am planning to sort these independently as much cheaper than going through the mortgage advisor but at what stage do I take them out as the mortgage provider is asking for details. All I have at present is quotes but wasnt going to take them out until I knew I date when I would be moving?

As I understand it, your building insurance should be in place at exchange of contracts. You will need to arrange it beforehand. Once the date of exchange is known, you could arrange it to start on the date of exchange. At least, that is what I plan to do.

tink_1983

How would this then work with new builds, were you might exchange contracts but not complete for 2-3months? are you paying buildings insurance on a house that is not yet fully build?

kingstreet

christine,

If you are thinking about life cover, I suggest you get quotes and an application in asap. You can then get the cover underwritten and accepted, ready for exchange.

If exchange doesn't take place before 21/12/12, put your life cover in force anyway. That's the day that gender neutral pricing starts and premiums for women will be going up that day to bring them into line with the cost for men.

To keep the old rates, the policy has to be underwritten and in force before that date.

AlexMac

Check why they want detail of life cover? Call me cynical, but is it because they want to bounce you into life cover with them, whether you want/need it or not (for example some employers already include death in service benefit in their pension plan). And maybe someone else will know if it is it still legal for a lender to insist you have life cover as a condition of mortgage? I've never had life cover (or PPI) in the 30+ years I've had mortgages. And will their house insurance cover be as good/as cheap as other providers?

Having said that, when I extended my Nationwide mortgage to buy a bigger house last year, I did take up their offer of house structure (but not contents) insurance, as it was reasonably priced and meant I didn't have to rush around ensuring cover to synchronise with completion, and it included the added benefit of cover between exchange and completion, whether or not the vendor had cover in place.

kingstreet

Those single with no dependents and with no-one in particular they want to leave an unencumbered property to, have no need for life cover and it cannot be made compulsory.

christineg79

Thanks for your help!

So house insurance and life insurance are not compulsary to complete my mortgage?

Yorkie1

Buildings insurance is compulsory if you are getting a mortgage.

Contents insurance is a good idea but not compulsory.

Life insurance is a good idea for some people but not compulsory.

Mobeer

Note if buying a leasehold flat then the buildings insurance is likely to be held by the freeholder, so you do not need a separate policy.

kingstreet

Mobeer wrote: »

Note if buying a leasehold flat then the buildings insurance is likely to be held by the freeholder, so you do not need a separate policy.

True.

But don't assume if a house is leasehold it will always be insured by the freeholder. My mother in law had a terraced house built around 1900 on the residue of a 999 year lease, which she was responsible for insuring.