Brendan thank for that (apologies for that other THING, I am an AAM novice) but I've made great progress and I thank you again and those who offered kind support and advice.Hi JD
Don't worry about it.
The main risk you were running was the high level of arrears and potentially being forced to sell your home. You appear to have resolved this now.
The Mortgage Protection policy is separate from the mortgage and the level of cover usually assumes a gradually reducing mortgage balance.
For example, if your initial mortgage was €200k, they might expect you to owe €100k after 20 years and so the cover would today be €100k. But if you restructured your mortgage, the balance today is probably €120k, so if you kick the bucket today, your estate will have to clear a mortgage shortfall of €20k.
If you have compromised health, then there is nothing you can realistically do about it. If you come into money, you can pay a lump sum off the mortgage and get back to where you should have been.
The owner of the mortgage is taking very little risk. There will be a shortfall of €20k if you die, but your Executor will not be able to pass on the house until he has cleared it.
Brendan
As part of the arrangement they should have ensured that your mortgage protection covers the full term of the new arrangement and is not short. Usually they ask for two refusal letters from two insurers and that's it but it doesn't look like they have got that far. It looks like you are just going to have to run the risk of not dying in the uninsured period and your family being able to meet the repayments if the unfortunate does happen.
Do you have life cover in work that can be used to pay off the debt if you died? (this cover can't be assigned against debt).
With the rearrangement in debt, does your existing cover still cover the outstanding debt today?
Steven
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