Mortgage and associated life policy legal question

A

Asco

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Im not sure if I should have put this in with insurance or here so feel free to move. I've not posted here in a very long time so couldn't find my old username etc.

Anyway, my question. I'm separated (not legally) soon to be divorced. I live in the family home with our 3 children my new partner and my new baby.
I pay the mortgage and associated insurances. The life policies amount to €140 a month and cover myself and my ex husband. I no longer wish to pay his portion of the life cover but he is refusing to take a policy of his own. For me to take the same level of cover as a sole policy will cost me €45.
Basically the bank obviously won't accept a policy in my sole name as it doesn't cover the criteria, can I cancel the direct debit only on the existing policy or does that leave me still breaching the conditions of the mortgage and risking them calling in the debt?
Any advice as to how to get around this?
Am I being clear in what I am asking??

Thanks a million
 
If you cancel the Direct Debit and the policy lapses, then you are in breach of the terms of your mortgage. But in reality I just can't see your lender calling in your loan over something like this. (Let's assume for a moment that you couldn't raise another loan elsewhere to pay them off and don't have access to the cash to do so either.) They can call in the loan all they like, but if you haven't got the money to pay them back in one go, what are they going to do? Repossess the house? Over the fact that a life insurance policy lapsed? I wouldn't think so.

If you do cancel the policy, make sure you have your own single life policy in place first.

I presume that all of this will be formally sorted out as part of the divorce.
 
Thanks for reply, I'm sure it will all be done as part of divorce but it will most likely be the end of the year before that is finalised, I was hoping to have this issue resolved sooner. In addition I want his name kept on the mortgage after the divorce for interest rate purposes, I've been on to the bank in this regard and it looks like this will be a credit decision so it should happen, I'm just sick of paying his loading. I have a policy ready to go in my sole name I just need to find out how to do it without causing problems with the bank.
Thanks again.
 
Asco said:
In addition I want his name kept on the mortgage after the divorce for interest rate purposes, I've been on to the bank in this regard and it looks like this will be a credit decision so it should happen,
Click to expand...

Are you on a tracker? If so, your interest rate could potentially be put at risk if you break the terms. That said, I haven't come across a bank actually throwing someone off a tracker because the life policy lapsed.

In the past some lenders had a block life insurance policy and if you cancelled yours, they could unilaterally add you both to theirs and charge the premium to the mortgage. Haven't heard of such a block policy for years though.
 
Lenders still have the power to use a block policy, I hadn't thought of that. Could they add him to the block policy if I offered to assign a new policy to them? Yes I'm on a tracker, best in the market as it happens, if I lose the tracker my interest rate goes up by at least 3%
I guess I'm gonna have to suck it up and keep paying his policy, now is it bad if I start wishing a serious illness on him so I get the benefit of having paid for his cover????
 
Hi Asco The level of cover on the policy could be reduced just to have mortgage protection on its own Sounds like you hae SI cover Just a thought as that is the minimum requirement for the lender Cost of re instatement at a later date will need to be checked If you get the advise of a good broker or accountant they will set you on the right path
 
I don't need policy advice as I know my way around the policies, it's the legal aspect I was querying, I see where you're coming from though, but it's an io mortgage so level cover is required. Also, if something happens me the mortgage is paid I'd like the same to happen with him, I just don't want to have to pay for his cover.
 
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