Re Interest rate and mortgage protection plan

[Tarquin]

I h

 

[budapest]

1. The discount is probably for one year only, but you can always switch after that year is up and shop around for the best quote you can find then.

2. If the rate is variable, then it will increase if the bank's rates increase. This would happen regardless. If it's a fixed rate, and you have the offer already sent out to you, then all you have to do is sign it and send it back. It shouldn't go out of date over the course of a few weeks.

 

[irishpancake]

I have two questions (said before I am completely new to all this so forgive me my ignorance in advance!)

1 Our broker gave us a quote for mortgage protection (covers death and serious illness) and said it has a 20% discount. What she didnt say is if the discount is for the first year and we pay full whack after that. After reading a few previous posts, I'm now concerned that this 20% is for one year only, after we thinking the price we were quoted (with the discount) was the definite price.

2 We still haven't drawn down our loan as due to a few complications, it was only finally approved a few days ago. Plus the vendors of the house we are buying are in no mad rush to exchange contracts, so we are concerned that if interest rates went up before we draw down money, that the increase will be added on to the rate we had previously agreed. Is this possible? Again, after reading a previous post where this happened to someone, this is where my concern comes from. I read about possibly being able to book the rate.

Thanks everyone.

Did you ask for serious illness cover when you asked your broker to quote for mortgage protection?

You should check out the publications on the IFSRA site, before committing to buying this policy, particularly this [broken link removed] and this [broken link removed]. You may find that you do not actually require serious illness cover, as you could be covered in other ways, e.g. through Income Continuance/Protection cover at work, or otherwise.

It it probably advisable to just purchase reducing term policy, sufficient to pay off your mortgage in the event of either death.

Shop around for this and other Life/Serious Illness policies.

The person i would recommend without hesitation is John Geraghty at labrokers.ie. I used him last year and got a 90% first year discount.

As regards your mortgage rate, if this is a Tracker, it is variable, and will go up, or down, in line with the ECB rate. If fixed, i would talk to your lender to see if they will honour the rate, or ask if you need to "book" the rate in advance.

 

[budapest]

I agree with labrokers.ie for the first year, but afterwards, their quotes were much higher than I could get elsewhere.

 

[Petal]

Definitely book the rate for your mortgage as mentioned before. Otherwise it will go up, it has happened to people who weren't aware of this, the increase came one day before drawdown of the mortgage. Needless to say they were not amused! There are some speculations that the ECB might hike up the rates again as early as March....