Mortgage Protection, living in UK

[pflangan]

I've just taken out a mortgage on a property in Ireland, and I'm in the process of arranging mortgage protection and term life assurance.

My question is this; Will my mortgage protection still apply if I am no longer resident in Ireland?

If, for example, I continue to live in the UK for a number of years, say 5, and I die while living here, what is the risk of mortgage protection not being paid out?

And before people start asking how I could take out a mortgage without protection, I had to take out an investment mortgage because of my circumstance (my income is from the uk, therefore I couldn't really get a mortgage on a family home)

 

[ClubMan]

My question is this; Will my mortgage protection still apply if I am no longer resident in Ireland?

The terms & conditions of the policy should answer this question.

Sounds to me like this is an investment property and not a PPR by default right now while you are not resident in Ireland or the property. Maybe you can clarify?

 

[pflangan]

Technically it's an investment property. I've been working in the UK for the past 6 months, and it's on my earnings here that the mortgage was applied for. Because of this the only option the bank gave me was to take out an investment mortgage.

I intend on returning to live in this residence in the next few years, but for the meantime, I suppose it will be classified as an investment property.

Do you know what implications this has?

Thanks for the prompt reply clubman. You must be as busy working as myself.

 

[ClubMan]

Not sure what you mean by "technically" and "suppose". There really should be no doubt about whether or not it's an investment property. For example your solicitor should presumably have advised you and you should most likely have paid investor stamp duty if it is not a PPR now. Unless you qualify for it being treated as a PPR while you are not in occupancy by virtue of your being seconded abroad by your job?

Assuming that it is an investment property right now then this has tax (e.g. stamp duty and CGT on at least least part of any eventual resale gain), mortgage (e.g. your lender needs to know that you are not an owner occupier if they don't already), tax relief (e.g. no owner occupier mortgage interest relief until it is your PPR), insurance (e.g. standard owner occupier policy will not cover an investment/rental property) and maybe mortgage protection life assurance (depending on the policy terms & conditions) implications. You probably need to get independent, professional advice on all of these matters regardless of the feedback that you get here.

 

[pflangan]

Sorry for not being more specific. Yes, an investment mortgage was the product the bank sold to us. I said technically it's an investment property at the moment because of certain factors;

1) I/we wanted the buy the property to live in it ourselves.
2) I wasn't able to take out a 'family home' primary residence mortgage because I didn't have sufficient earnings in my job in Ireland to justify a mortgage of 470k.
3) I had to use my earnings from my new position (of 6 months) in the UK to justify the mortgage.
4) Because I'm in the UK, it couldn't be classed as my primary residence as I'm not living in Ireland at the moment.

5) I was told by the bank that an investment mortgage was the only way I could buy the property in Ireland, while resident in the UK.

I agree on the independent advice, am in the process of seeking it at the moment.


thanks.