ISMI reform will be too late for many so brokers must step in

The Council of Mortgage Lenders\' call for Income Support for Mortgage Interest to be reformed should be applauded.

The housing market of today is different from that of 1995 when ISMI was introduced.

It’s absurd that it only covers the interest on mortgages up to £100,000 when the average mortgage taken out today is almost £160,000.

While the industry should support the CML as it lobbies the government, any reform is likely to take some time to make its way through the legislative process so change may come too late for many consumers.

With more than a million home owners seeing their short-term fixed rate deals expire this year, how many will have problems securing new mortgages? How many will be pushed to the brink as they face higher borrowing costs?

It’s important for brokers to exercise their duty of care towards clients to help them protect the roofs over their heads and ensure they have adequate cover. But they can also help previous clients who didn’t take out any form of protection.

Paul Thompson
Chief executive officer Assurant Solutions Intermediary
By email