Homeloan Partnership (HLP), the mortgage network, has signed a deal with Equity Protection Policy (EPP) which will give homeowners access to a new insurance product protecting them against negative equity.
The launch comes just ahead of what could be an economic downturn in 18 months time, based on predictions from city experts, says HLP.
It may be that some homeowners will need to sell up due to the expected rise in interest rates, says HLP, so this insurance is designed to provide some peace of mind to policyholders should the need to sell their homes arise.
HLP managing director, Steve Hoare, said all policies are written as individual units worth £12,500 each and borrowers can buy a maximum of five units. This means a borrower with one unit could insure against a 12.5% drop in their property’s value.
Cover is available on house purchase and remortgage products, but it is only available through HLP intermediaries.
Hoare said: ‘We cover all bases ‘ whether it involves a job relocation, a family-planning blight or simply re-mortgaging, clients can feel safe that should the property sell for less than they paid for it, they have an insurance policy that will enable them to recoup that loss.’
Julie Henderson is editor of IFAOnline