Selling and buying. Moving existing Mortgage Protection to new mortgage.

lmd

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Current mortgage remaining on house we are selling (640k) is 245k. Purchase property (700k) max mortgage we can get due to age (58) is 292k which leaves us short some when taking into account costs as well. We will withdraw shortfall from ARF, not ideal but we realised if we wanted to get the right house we needed to use some the ARF which will be at higher rate of tax.

Our current Mortgage Protection policy will allow us to transfer current policy to the new property to a max of 285k. We are thinking it is better for us to take the reduced mortgage of 285k (7k less than offered) in order to avoid getting a new Mortgage Protection policy which we know is going to require medicals (ages 58 and 53) and whilst no major health issues that we know of I know BMI and blood pressure may be an issue and obviously everything will be delayed and our buyers are anxious to get into our house and we are anxious to get sale and purchase through also.

Do you think it makes sense to tell lender we only want 285k and go down this route of taking the 7k from the ARF to avoid new policy? We think it does but just wondering what others might think. Thanks in advance.
 
In general yes it makes sense to tap ARF rather than risk sale falling through over life insurance.

But it’s worth checking with your lender whether they would accept a second policy for the balance of €7k.

If they’ll accept that it costs you nothing to get a quote and might save you having to tap into the ARF. Even if a top-up policy is very expensive you’ll have the mortgage paid down quickly and will be able to cancel.

It’s better to have options.
 
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They might give you an exemption as you are both over 50 so there is no legal requirement for mortgage protection.
Thanks Brendan. I didn't realise that. We may be going with Credit Union for mortgage so would we just ask them can they waive it?
 
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Great, thanks Dr Strangeglove very helpful.