Following recent revelations that only 2.7% of people taking out new mortgages and 5.4% of existing borrowers have financial cover to ensure continuity of their payments if they become unemployed, the survey has uncovered why the uptake is so low – nearly half of mortgage lenders are failing to offer it as an option.
Burgess commissioned online market research firm Usurv to survey 1000 new mortgage borrowers, asking why they didn’t purchase unemployment cover. A staggering 46% said it was not discussed or offered to them by their lender so they didn’t know it was available; 27% thought it unnecessary as the government would protect them if they lost their job and 24% would never buy the product as it has a tarnished reputation. The remaining 3% purchased cover – in line with previous survey findings.
Burgess comments:
“These figures are astounding, why are so many mortgage lenders shying away from offering the very products that will prevent customers from amassing debts and enable them to keep their homes during times of hardship? It doesn’t make sense - lenders are asking borrowers to jump through hoops to evidence they can meet their financial commitments before offering a mortgage but are not offering support mechanisms when they can’t.”
