You’ve searched for a new home, fallen in love with the indoor-outdoor flow, and are ready to commit. 

After months of open homes, builder’s reports, and rejected offers, it can all feel really exciting when the stars finally align. You’ve found the perfect property; you’ve considered the numbers and how it works in your financial plan and successfully made an offer. But once you go unconditional, the work doesn’t stop. Aside from negotiations, financing, and booking the movers, there’s one important step that cannot be overlooked. Your protection plan.  

We’re not talking about home and contents insurance (although these are very important components to your protection plan). We’re talking about protecting your ability to maintain your mortgage repayments, which leads us to the focus of today’s article: mortgage protection.   

 

Mortgage protection insurance 

Mortgage protection can play an important role to help you meet your mortgage or rent payments in the event you lose your income due to illness or injury.  

Committing to a mortgage can feel intimidating and there’s a lot to juggle financially. But if the fear of losing your income keeps you up at night, it pays to give yourself peace of mind to know you or your loved ones can maintain your repayments if the worst was to happen.  

 

How does it work? 

Like income protection, mortgage protection can make regular payments for a certain period (if specified) or the duration of the time you are medically unfit to work. 

While the name suggests otherwise, you aren’t restricted to using those payments towards your mortgage or rent. You can use the funds how you like. But the payment amounts you’re eligible for are generally set in alignment with your existing mortgage or a percentage of your annual income. With this in mind, many might take out a mortgage protection policy as part of their wider personal protection plan which may include Income Protection, Trauma & Permanent Disability or Life.  

There’s no one size fits all approach around deciding how much cover you need, and how long you need it for. This is where an adviser can help. They can support you with determining your needs, the lifestyle you’re looking to protect, and tailoring a plan that’s fit for purpose.  

 

Why mortgage protection? 

Sometimes life doesn’t go to plan. You might have a great job that affords you a lifestyle you enjoy. But if you rely on your income alone to fund your lifestyle (and keep up with your mortgage repayments), it’s best you protect it.  

Think of your protection plan like your house. It stands with the structure of foundations, walls and a roof; Mortgage Protection insurance acts as the beams supporting the walls and roof in order to deter any damage caused by a bad weather event.   

Life is unpredictable, and financial security is not always guaranteed. Mortgage protection helps reduce your sleepless nights and financial worries by protecting your lifestyle and what matters to you most. 

 

Build strong foundations 

Time to review your protection plan?

Harness our wealth of knowledge, book a review with an AdviceFirst Financial Adviser today, and take control of your financial future. 

 

Disclaimer: This blog post is for informational purposes only and does not constitute individual financial advice.