Insurance searches and effect on mortgage

c.cam108

My wife and I are currently in the process of buying our first house. We already have a mortgage offer through from Halifax, and are in the process of negotiating the finer details with the seller.

My mortgage broker has been working very closely with my solicitor, which has been great, and he is suggesting that he sorts out our home insurance for us and provides the documentation to the solicitor.

I'm not one to blindly accept these things without comparing, but he is insistent that we should not do any comparison for home insurance, due to the footprint on our credit report from multiple searches, which could scupper our mortgage.

I checked up and Experian confirm that soft searches are not visible to other lenders (http://www.experian.co.uk/consumer/questions/askjames352.html) but our broker is telling us that mortgage lenders are able to see these searches from all three agencies.

Who is right here? Should I go ahead and arrange insurance myself, or should I play it safe and take the insurance offered?

YorkshireBoy

Insurance comparison searches are unrecorded enquiries, and as Experian say they're not visible to anyone other than yourself, the CRA, and the organisation making the search.


But even if they were, do you seriously think the mortgage company would penalise someone for such a thing?

should I play it safe and take the insurance offered?

It would appear he's on a commission. Ask him to put his claim in writing...he won't!

c.cam108

Thanks - that's what I expected.

It would appear he's on a commission. Ask him to put his claim in writing...he won't!

This was via email - so already in writing!

YorkshireBoy

c.cam108 wrote: »

This was via email - so already in writing!

I'd be taking that further. Maybe not yet, but certainly upon completion.

David_White

It's behavior like that which can give the industry a bad name.

I certainly wouldn't do any further business with them and would take your insurance out elsewhere!

c.cam108

Thanks for the advice. He has also given us an application form for life insurance. I'm not sure who the policy is with or what level of cover it offers, but is this cover required before we can get our mortgage? Can we put it off until after we move in and have time to research our options better?

David_White

The only insurance which is mandatory is buildings insurance and you need to have that in place for exchange of contracts as that's when you are liable for the property.

That said, you should also be considering life cover, criticial illness cover, income protection and contents insurance.

You don't need to do any of the above with your broker, you can set them up however you like.

Whilst you can wait to sort out your life cover etc I would be wary of that, because you'll leave it a few weeks which will turn into a few months and the next thing you know you could be a year or so down the line needing cover but having nothing because you didn't get round to it.

I've seen this happen.

c.cam108

Yes I'd need to be wary of that. My concern though is rushing into a life insurance policy now rather than waiting a couple of days and properly investigating our options (our completion date is hopefully going to be this Friday).