Mortgage indemnity and life assurance

reg999_2

I am totally bewildered by all the PPI stuff going around but have been advised to check out whether I can claim back for a mortgage indemnity we had to take with the Nationwide when we re-mortgaged in 2006 and also whether all the life assurance was necessary as we already had in place policies. Any advice would be greatly received.

magpiecottage

Mortgage Indemnity Policies were typically policies taken out be lenders, which borrowers paid for, in case the borrower defaulted and the a forced sale did not fully cover the debt. This was a commercial decision by the lender and would therefore fall outside FOS jurisdiction.

dunstonh

but have been advised to check out whether I can claim back for a mortgage indemnity we had to take with the Nationwide when we re-mortgaged in 2006

Are you sure you paid MIG in 2006? Most lenders had dropped MIG by the mid to late 90s. You cant reclaim it either as it is a fair and valid charge.

and also whether all the life assurance was necessary as we already had in place policies.

Again, by 2006, most lenders had abolished the need for life assurance and left it down to consumer choice. However, very few people have enough life assurance. A complaint would only likely succeed if you were able to show you had enough cover in place and didnt financially need it. A really crude guide is 10 times your income plus all debts. If you have that sort of figure, you are in the ballpark where it may not have been needed. If you are nowhere near that figure then you almost certainly dont have enough life assurance (based on a typical family - it is a really crude guide only).

magpiecottage

dunstonh wrote: »

Are you sure you paid MIG in 2006? Most lenders had dropped MIG by the mid to late 90s.

That's a good point - I was on the train home after a VERY long day when I posted last night.

However, Nationwide did not charge MIGS anyway (they charged extra interest for the first twelve months instead).

pups2

so if I am understanding you correctly it is better to have a life policy to cover your debts and mortgage and debts if you were to pass away

dunstonh

pups2 wrote: »

so if I am understanding you correctly it is better to have a life policy to cover your debts and mortgage and debts if you were to pass away

That is what most do (as well as other insurances).

roonaldo

dunstonh wrote: »

Are you sure you paid MIG in 2006? Most lenders had dropped MIG by the mid to late 90s. You cant reclaim it either as it is a fair and valid charge.

I took a 95% Nationwide mortgage in 2006, no MIG. So you and magpie cottage are correct. There were a few lenders that still did at the time and I chose Nationwide specifically for the lack of mig and good rate.