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FAQ’s

The benefit of placing a life policy into Trust is that it does not fall as part of your estate and the money is paid directly to the trustees. If the life insurance policy is not in Trust, it would be added to the deceased person's estate and potentially cause an inheritance tax bill if the deceased nil rate band is fully used up.

For example, John is single and has a mortgage-free house worth £300,000 and a life insurance policy of £100,000 which is not in Trust. The value of his Estate is £400,000, minus his nil rate band of £325,000, means that £75,000 is potentially liable for Inheritance Tax (IHT). His beneficiaries would need to pay 40% tax on the £75,000 before they could inherit his estate.

As part of our advice and service, we do recommend that your policies go into Trust. The life insurers provide basic Trust forms which are free to use. If there is an existing policy, you need to request the relevant trust documents from your provider, and if you are setting up a new policy, this can be done at the time of application before the policy is put on risk.

Income protection insurance is an insurance policy that provides a monthly benefit if you are unable to work due to accident or sickness and pays out until you return to work, the end of the policy term (usually your retirement age) or upon death, whichever is sooner.

A decreasing term insurance policy is used to provide life cover for a Repayment (Capital & Interest) mortgage. With a decreasing term insurance policy, the sum assured reduces in line with the mortgage balance every month and is designed to last for the term of the mortgage.

A level term is used to provide life cover; the sum assured stays the same for the duration of the plan. This plan can be used to repay a mortgage debt and provide a legacy for loved ones.

We work with over 50 of the UK’s biggest Mortgage Lenders. Please see the full list in alphabetical order below for the lenders that we deal with directly:

Accord Mortgages, Aldermore, Axis Bank, Bank of China, Barclays, Bluestone Mortgages,BM Solutions, Buckinghamshire Building Society, Chorley Building Society, Clydesdale Bank,Coventry Building Society, Cynergy Bank (Bank of Cypress), Danske Bank, Dudley Building Society, Fleet Mortgages, Foundation Home Loans, Godiva, Halifax, Hanley Economic Building Society, Hinckley & Rugby Building Society, Hodge Lifetime, Interbay, Kensington Mortgages, Kent Reliance, Landbay, Leeds Building Society, Lendinvest, M&S Bank, Magellan Home Loans, Mansfield Building Society, Melton Mowbray Building Society, Metro Bank, Monmouthshire Building Society, National Counties Building Society, Nationwide Building Society, NatWest, Newcastle Building Society, Norwich and Peterborough Building Society, Nottingham Building Society, Paragon Mortgages, Pepper Money, Principality Building Society, Progressive Building Society, Saffron Building Society, Santander, Scottish Widows Bank, Shawbrook Bank, Skipton Building Society, State Bank of India, The Family Building Society, The Mortgage Lender, The Mortgage Works, Together Mortgages, TSB, Vida Homeloans, Virgin Money, Zephyr Homeloans

With an interest-only mortgage, your monthly payment will only cover the Interest charge on your mortgage and your actual mortgage balance (or capital) will not reduce. Therefore, at the end of the mortgage term, your balance will be the same as the original amount borrowed.

With capital repayment, you will not only be covering the interest charge but also some of the capital borrowed each month, which means that as long as you keep up with repayments, your mortgage will be paid off at the end of the mortgage term.

A bridging loan is taken out to ‘bridge’ the gap between the purchase of a new property and the sale of an existing one – usually when you are moving home. The loans are generally short term and secured on the existing property but repaid once the current property is sold.

In a commercial sense, Bridging Finance is more commonly used to buy a property that is in disrepair, will undergo extensive redevelopment or requires planning permission to change its use to name a few, in these examples a conventional mortgage may not be available. They are also commonly used for auction purchase where a transaction is needed to meet deadlines.

These types of loans will help you secure your new purchase and are more expensive than conventional finance/ mortgages. With any Bridging loan, you need to have a long-term solution (often referred to as the Exit) on how the bridging loan is to be repaid.