The head of intermediary development at L&G, Richard Kateley has stated that there is no justification for mortgage advisors failing to raise the issue of mortgage protection with borrowers before they sign the contract.
Kateley made these comments during an appearance on the podcast run by Accord Mortgages, called Growth Series, and went on to say that policies featuring protections were not something that potential borrowers actively sought very often. However, he then added that this left the advisor responsible for persuading the borrower by pointing out that not having them means a much greater risk.
Kateley emphasised that the way the majority of successful advisors deal with the challenge that this presents is by combining the protection and the actual mortgage in one package instead of presenting them separately, as this helps to ensure that the borrower is not signing up to anything that is more than they can afford each month. Kateley went on to add:
“If a client says they can’t afford the protection, can they actually afford the mortgage? It has to be part of your process to talk about protection. If you’re too busy, is that fair on the client?”
He finished by suggesting that the risks involved in not having protection could be highlighted by advisors raising possible situations that could leave the client unable to maintain the repayment schedule.
Advisors who have undergone CeMAP training are more likely to be aware of what their responsibilities to clients, as well as lenders, are.