Is Life Insurance compulsory on a Buy to let mortgage or a business loan?

[axil23]

Getting a mortgage and have been advised by the bank that Life Insurance is compulsory. Was quoted £45 a month and when I said that I would shop around was told that it wasn't worth it as I would have to get Lawyers involved to sign over the policy to the bank.

 

A quote through Aviva is £11 a month.

 

Are the bank right in this? How much will it cost for a Lawyer to sign over a policy saying that I will save over £300 a year.

[dx100uk]

life ins is NOT compulsory on a std mortgage

not sure about buy to let

the only ins you MUST have in-place is buildings.

-

dx

[axil23]

I was specifically told that Lloyds has made this compulsory. Any way to confirm this? Tricky position..... If I take this up with them then I spoil my relationship if not then I get ripped off.

[dx100uk]

who's saying this and is it in WRITING.

 

are they pointing you toward skittish widows par chance?

 

dx

[axil23]

Yes they are asking for a skittish widows policy. The person looking after my account is asking me to take this out.

[dx100uk]

is it in writing you must take it out

 

prob just verbal as the advisor wants the commission

that's whats it really all about

 

dx

[axil23]

Quite shocking really. You would think the banks would have learnt after the PPI saga.

 

Tricky situation... what would you do? If I complain my relationship manager will get angry and the so called relationship will go for a six. If I don't then I am a mug.

[dx100uk]

cant see why the 'relationship manager' is doing it [bar fleecing you for the commission to their pocket]

 

have they had you on stuff before that you are not aware of

 

loans etc..

 

must think you are a soft touch if they've spoofed you in the past

 

dx

[axil23]

Not sure if I can post link to another forum but here it says that Business bank loans do need Life insurance.

 

http://forums.moneysavingexpert.com/showthread.php?t=3230988&page=1

[2Grumpy]

They want some money even if you die. They might not be able to get their hands on the property ...

[dx100uk]

you said mortgage

 

where did business loan cone into it?

 

as for those posters on MSE

 

you need to be very careful about what you read over there.

 

they are never questioned upon IF they are right.

 

if you look CAREFULLY

 

you'll see those 2 specific people ALWAYS advise on PPI/Life etc

 

and 9/10 say no you cant do this or that

for some really bizarre reasons sometimes.

[Surfer01]

I no longer use MSE due to abuse you get if asking a simple question plus I cannot count the number of times I have seen incorrect advice posted. There are times though when good advice is posted as not all bad!

[axil23]

Its for a Buy to let so is that considered a mortgage or a business loan? So does this mean a Business loan is subject to Insurance?

[2Grumpy]

Is it likely that the lender wouldn't get their money back if you died and didn't have the life insurance?

 

Is it any more likely with it?

[dx100uk]

no itgoes to the person naneed not them

 

spoof!

 

dx

[axil23]

Well got it in writing that its compulsory for a business buy to let loan.

[axil23]

I took out a buy to let mortgage a couple of months back. My bank manager insisted that I needed Life Insurance and I can only take out one through them. I needed the mortgage and was a novice at it so thought to go ahead. Now checking every other bank does not insist on Life Insurance.

 

What are my options? Can I cancel the Life Insurance and go through a different company which is saving me almost £30 a month.

[gregs07]

Yes in short, get it with anyone you like. Juat make sure it fulfils your needs ie length of insurance decreasing or lump sum, critical illness etc see a broker or read up on the web is my advice.

[axil23]

 

Why does Lloyds insist on getting it through Scottish Widows? Another PPI waiting to happen in my opinion.

 

Can I cancel a policy 2 months in?

[dx100uk]

yes cancel and reclaim it.

 

 

the only thing you must have in place is buildings.

 

 

he made a nice commission out of you.

[axil23]

Are you sure about this?

[dx100uk]

well if its in the t&c's you cant

 

 

if its in WRITING that you must have it

you must have it.

 

 

end of really.

 

 

dx