How Chronic Illness Can Affect a Mortgage Application

Are you wondering how a health issue may affect your chances of cover but don’t have the time or inclination to read this blog?

That’s ok, we’re all busy people.

Just complete this medical questionnaire and I’ll run it past my panel of underwriters anonymously and get back to you over email

Everyone else – onwards!

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What is Mortgage Protection?

So basically, Mortgage Protection Insurance clears your mortgage if you pass away before you’ve paid off your loan.

For any residential mortgage, you’re legally obliged to get Mortgage Protection, so there’s no way around it.

The cost of it will depend on the size of your mortgage, your health, your age, and whether you smoke.

If you have an illness, ‘your health’ is the worry.

Many people make the mistake of getting Mortgage Protection with their bank because it seems like the obvious thing to do.

Sure, it’s easier, because it wraps everything up in a neat little bow.

You don’t have to shop around and it gets it sorted.

That’s not to say it’s the best move though.

For one, it’s a bank and, as we all know, banks are prone to shenanigans.

And two, you can probably get a better deal with a broker.

Ultimately, you’ll get the best deal by shopping around and that’s exactly what a sound broker, like me, will do for you.

Mortgage Protection if you have a Health Condition

Look, having a health condition sucks.

It just does.

But it shouldn’t affect your chance of getting a mortgage.

In some very extreme cases, the insurers will think the chances of you having to make a claim are too high and they’ll say no, but that’s rare.

Or they may postpone offering you cover, which isn’t the best news– but it’s not the end of the world as it’s a “not now” more than a firm “no way”.

The insurers underwrite applications on a case-by-case basis, but for now I’ll say this: the majority of people should have no problem getting Mortgage Protection.

However, getting Mortgage Protection with a health issue can take time so it can be a matter of urgency.

If you’re slap-bang in the middle of the property purchasing process, get on this now.

If you’ve got an offer in on a property and you don’t have Mortgage Protection sorted, complete this questionnaire.

Seriously.

Click that link and do it now.

In straightforward cases, you can get Mortgage Protection in less than a day.

Our process goes like this:

1. You complete that questionnaire.
2. We check with all of the insurers and choose the one who seems most willing to offer cover.
3. We send your their application form to complete online.
4. We’ll email you the documents to sign digitally and you’ll send them back.
5. We’ll submit the application form to the insurer.
6. If you have no health issues, your policy will be issued pretty much immediately.

Unfortunately, it’s not that straight-forward if you have a health issue.

Instead, you’ll have to fill in a medical questionnaire for a minor illness, or if it’s more serious, the insurer will need a doctor’s report – which can add mileage onto the process.

Some GPs are quick to send back the reports but most are slower than a Tuesday after a long weekend.

On average it takes 4-6 weeks to get a medical report back from the GP.

The medical questionnaire asks for details on your illness, when you were diagnosed, symptoms, treatments – that kind of thing.

Once that’s all said and done, you should be able to get Mortgage Protection – and you can seal the deal on that dream house.

And now for some final pro tips:

1. You don’t need Life Insurance if you’re getting a mortgage; that’s what Mortgage Protection is for. Life insurance is more profitable for the bank so don’t be surprised if they push it.
2. Mortgage Protection isn’t mandatory for an investment mortgage.
3. If you’re not married, get two single life policies where you pay your other half’s premium and vice-versa. It reduces any potential inheritance tax liability 😉
4. DO NOT GET Serious Illness Cover with your Mortgage Protection. Banks get any pay-out on Serious Illness if it’s on your Mortgage Protection policy. Keep these policies separate.

Over to you…

Got any questions on mortgage life insurance but can’t find the answer in our FAQs?

You can fill in this short form and we’ll be right back or give me a call on 057 93 20836.

Thanks for reading

Nick

Editor’s note | We published this blog in 2018 and have update it regularly since.