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Cautious property buyers should take out life insurance

Date: Thu, 05 May 2005

Many buy-to-let landlords are remaining cautious and realising the value of life insurance cover.

Although some lenders are offering landlords the opportunity to obtain mortgages for a higher percentage of the total purchase price, almost two landlords in three prefer to borrow no more than 85 per cent of the value of a property.

"Although increased LTV limits may have secured a lot of publicity, these increases, in some cases way beyond 85 per cent, are aiming at a very thin market," said Nicola Severn, marketing manager at Mortgage Trust.

"Buy-to-let landlords operating in today's market are cautious investors who believe in responsible borrowing. They have little desire to mortgage themselves above modest levels."

Having life insurance cover means that such second-house owners could avoid passing on costly debts to relatives, if the worst should happen.

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Endsleigh Insurance Services Limited. Company No: 856706 registered in England at Shurdington Road, Cheltenham Spa, Gloucestershire GL51 4UE.