This should be a time used wisely, not only to review life goals, but also financial situations.

Due to the current unfortunate circumstances, we are now becoming very used to the Coronavirus lockdown.  However, perhaps this should be a time used wisely, not only to review life goals, but also financial situations.

Do you have a Will?  Statistics show that only one in three people currently have a will in place, with the remainder leaving the state to take over and determine how their assets and belongings are distributed when they die. 

Do you have Life Insurance, Mortgage Payment Protection Insurance (MPPI), Accident Sickness and Unemployment cover, Critical Illness Cover, and more?  Any of these products might be beneficial to your personal circumstances or needs, especially if you have children, and with competition increasing, these types of products are not as expensive as you may think.

MPPI makes it possible for you to keep on paying off your mortgage, even if you stop receiving a stable income.  People tend to choose this option because it is explicitly designed to cover their mortgage payments.

We often associate protection needs with homeowners, but it was interesting to see recent data suggest that the majority of renters are putting themselves and their possessions at risk because they do not have vital forms of insurance in place. Research from one provider uncovered evidence that just one in five rental households had life insurance, compared to three out of five homeowners with a mortgage. The figures are particularly concerning because the number of renters in the UK is rising, a trend driven by higher house prices and other challenges which make it difficult for would-be first-time buyers to get on the housing ladder.

A further study from another provider appeared to back up this trend, finding that whilst 41% of homeowners had life insurance or critical illness cover, just 26% of those renting had such a policy in place.

People are very quick to insure their pet, Sky TV, their travel plans and their house contents, but forget their biggest asset and this frequently gets left to last, or until it’s too late.

All in all, to make sure your financial situation is better protected, you really should investigate all options to cover you, your family and your financial commitments.  Familiarise yourself with all the options available and do your research before committing.  As always, seek professional and open market advice.

You'd use a local shop over a supermarket. It should be the same with your mortgage broker.

Through this unprecedented time, I can’t stress enough that you should be using a mortgage broker to review your requirements and help arrange your re-mortgage to cut down your costs.  Yes, you can sometimes go direct to the lender, but is it right for you?  Is there a better rate elsewhere?  Have you read all the small print? How long are you tied in for?  Fixed or Tracker rate?  Can you apply whilst in the three-month mortgage payment holiday?  Will the lender take my ‘Furlough’ pay as income?  And so on.

At times like these, changing your rate can be a huge decision as we all look to cut costs in order to see the next few months through.  Without professional guidance, you might not only get the wrong deal, but you might also miss it.  A wide number of lenders have withdrawn products recently, yet only advised us the day after the products were withdrawn.  Some lenders, due to the volatility of the markets, have even reviewed full mortgage applications in with them, and withdrawn their initial approvals!  Worse, some have actually withdrawn fully issued mortgage offers! 

This is a sign of the times and now, more than ever, you should be using your local mortgage broker.  Just like the local shops competing against the supermarkets, everyone is struggling and that little mortgage product transfer you’re doing through the smart phone app to your high street lender, could be vital income to the broker who may have helped you out so many times in the past.  Don’t cut them out, let them help and advise you.  It is unlikely to make a difference to you in terms of rate or fees, but it can make a huge difference to income being generated for the mortgage broker in these challenging and difficult times.

Generally, the housing market is coming to a standstill as the Government requests everyone to stay at home.  This means that surveyors cannot visit the property and therefore a lender cannot lend on a property it has no idea of the value on.  There are remote systems that can provide Automated Valuations (AVM), but only a few lenders will currently take these as a base to which they can lend to and the risk curve will only allow an AVM up to 85% loan to value. In the main, most lenders will only allow 75% AVMs at the moment and only on re-mortgages.  As we all get used to working from home, this may change.

Yet, through adversity, there are rays of sunshine!  A number of lenders are looking at ways to increase volumes, reach out to help customers and keep the market going.  Some of these will be offerings only available through the broker market channel.  So, keep in touch, keep the relationship close and let’s work together to achieve the best outcome.  We are fully functional and working from home during normal business hours.  We continue to offer our free advice service, so speak to the team and we’ll help you as best we can.  Keep well.