Mortgage protection policy cancer surviver

L

Lynden

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I'm about to purchase a house with mortgage of 200k. I have no dependants and a life insurance policy to value of 185k. My mortgage term is 15 years as I'm 51, I also have another home mortgage paid off which I intend to keep worth 160k.
My concern is that the bank won't accept my life insurance as mortgage protection as its not the full amount I need to borrow and that I might not get mortgage protection even though I am cancer free for 10 years.
Would appreciate some advice on this or has anyone had a similar experience.
Thanks.
 
Check if your bank offers a waiver option, this is allowable under the Consumer Credit Act 1995 which made mortgage protection compulsory but banks can set their own policy on it.

You would fit at least two of the categories in which the need for mtg protection can be waived, you are over 50 and you are unlikely to be able to secure new life insurance.

The fact that you have practically sufficient cover already in place would be a major plus in convincing the bank to allow you avail of the waiver option.

http://www.irishstatutebook.ie/eli/1995/act/24/section/126/enacted/en/html
 
Thanks Monbretia, its just a shame my life insurance is just short. This is a worry I could do without.
 
Lynden said:
My concern is that the bank won't accept my life insurance as mortgage protection as its not the full amount I need to borrow and that I might not get mortgage protection even though I am cancer free for 10 years.
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Which bank is that? Most banks have a waiver on life cover for clients aged over 50. perhaps rules in some have now been changed but I am surprised as it is not realistic to expect clients over 50 to obtain MPC.
 
44brendan said:
Which bank is that? Most banks have a waiver on life cover for clients aged over 50. perhaps rules in some have now been changed but I am surprised as it is not realistic to expect clients over 50 to obtain MPC.
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The bank is AIB
 
Lynden said:
and a life insurance policy to value of 185k.
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The refusal sounds absolutely ridiculous if you meet all of the other criteria. This sounds like a "computer says no" decision. If I were you I would lodge a complaint with the Bank's CEO. As a banker it is mindless decisions of this type that give us a bad name and undermines any kind of credibility as being customer focused. I would make a big fuss about this as you appear to have been treated extremely harshly by some mindless cretin!!!!!
 
44brendan said:
The refusal sounds absolutely ridiculous if you meet all of the other criteria.
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The bank haven't refused. The OP is raising the issue as their own concern

Lynden said:
My concern is that the bank won't accept my life insurance as mortgage protection.
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Edited to add : Actually reading it again. it can be read either way.

Lynden, have the bank refused or are you just worrying before approaching them?
 
Fair point Blinder. I suspect your 1st reading of the scenario is correct. Difficult to believe that any bank would decline the mortgage on that basis!
 
Hi All, In farness to the bank they haven't refused yet, I started the approval process using the online portal and so far everything I submit is a case or "the computer says No" so I wasn't hopeful that when it comes time to submit MCP, which they say in mandatory, the answer would be any different. Learning my lesson, I would have been better off going through a branch from the start as when I called to a branch for assistance they told me they don't have direct access to the eMortgage portal, which I though was very strange. I will keep the list informed on how I get on with this and thanks for the advice, I'm feeling a little more hopeful now.
 
That clarifies the issue Lynden! You should have no issue with the mortgage protection. See earlier postings above!
 
Update from the bank -
"I have discussed your request with the lending team and they have advised that we would require either 3 letters of decline or 3 letters showing that the cost is excessive / prohibitive before we would consider waiving a portion of the life cover."
Wow, this is why we all love the banks so much!
 
Is it possible then to just get loaded life cover for the 15K? Does the mortgage protection have to be covered on all the one policy?
 
Also, you should quote the consumer credit act to them, linked above, since you are over 50, and so you already fit the criteria, without having to prove that it would be too expensive
 
It doesn't all have to be covered in the one but likely if OP applies he will either get declines or prohibitive costs, bit excessive to look for 3 though. I'd be inclined to push them a bit on that as you do fit the other criteria, however a bank can decide it's own policy on this so they can stick to it if they want.

Can you apply to another bank for the mortgage as some are more flexible than others on this one.
 
Given the above response from the bank I would relate bank to my response of yesterday! The mindless cretin remark remains appropriate!
 
This means that my long suffering GP will probably get 3 requests for medical reports from 3 different companies. I did quote the Consumer Credit Act to them but they still came back with the 3 declines or 3 letters showing that the cost is excessive. Another question, who decides what's excessive or not?
Another point is that if a request is declined from one of these companies it will affect any further applications I might need into the future
 
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Why not submit a complaint to the bank? This is a really ridiculous request from them and they should not be allowed to get away with this kind of behavior!
 
Lynden said:
This means that my long suffering GP will probably get 3 requests for medical reports from 3 different companies. I did quote the Consumer Credit Act to them but they still came back with the 3 declines or 3 letters showing that the cost is excessive. Another question, who decides what's excessive or not?
Another point is that if a request is declined from one of these companies it will affect any further applications I might need into the future
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Having had cancer will be the bigger influence. you can always explain on a proposal that multiple applications were submitted to satisfy bank criteria. The fact that you are 10 years clear means you probably won't be declined but will have a premium loading. Unfortunately for all the parties involved, the underwriting process will have to be completed by each party (and at some expense) for them to know what that loading will be.

I echo what 44brendan said, complain. You are over 50 and a cancer survivor. It is bleedin' obvious that life cover is going to be expensive!


Steven
www.bluewaterfp.ie
 
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