Independent financial advice should be taken before taking out or surrendering an endowment mortgage. A repayment mortgage will suit some purchasers. It should be backed by a mortgage protection policy. This is usually a reducing term assurance policy at a monthly premium. The longer the repayment mortgage runs the steeper is the decline in mortgage protection, so an alternative is to arrange level term assurance which gives you flexibility to maintain cover when moving again and taking out a new mortgage, although the premium will be higher.
Most people s problems with mortgages start when they lose their job or a relationship breaks down.
If forced to sell up, there could be a heavy penalty for the early repayment. New borrowers receive no help from the Benefits Agency for the first 39 weeks of any Income Support claim. This applies even where an old mortgage is being transferred to a new property. Thereafter benefit payments for mortgages will be calculated at a standard rate of interest. The seller s solicitors will supply your solicitor with proof of legal title to the property you are buying and prepare contracts for agreement.