Buying a property is akin in many ways to completing a steeplechase: as soon as one hurdle is crossed, another one emerges to make life more difficult.
For most people, the race ends well, with the mortgage organised, house bought and new life successfully begun. For others however, the business of house-buying can be even more complicated. And the worse thing is that the complications will often be completely beyond their control.
At the top of the list on this front for many people will be health difficulties, both current and past. The issues that health problems can cause will tend to arise towards the end of the purchase process, just as time is of the essence and both sides are struggling to complete all details.
The type of illness that can cause complications in house-buying will vary, ranging from ongoing conditions such as diabetes (likely to delay the process) to once-off problems such as cancer (likely to threaten the process). Likewise, there are no fixed rules as to how a given condition will affect the smoothness of the deal, with each case considered on an individual basis.
The issue will always be the same however - it will centre on how willing a financial institution will be to deal with a particular housebuyer as a customer. In other words, they will try to work out the extent to which the illness or condition will affect the financial risk they will be taking.
Under consumer credit legislation, borrowers are required to have life assurance in place when taking out a loan for a main residence. This provision is designed to make sure that the mortgage will be paid off if the borrower dies before the term has been completed.
There are some circumstances under which life cover can be waived. This can happen where the borrower is declined cover for health reasons or is accepted for cover but only under a very high premium.
As Ms Sarah Wellband of mortgage broker REA points out, the nature of these provisos means that the mortgage applicant must go through the motions of applying for life assurance even if they know they will be refused cover. This can mean sitting through medical examinations or tests, all of which will take up precious time at a stage where the pressure will be on to complete the property deal.
Furthermore, says Ms Welbband, some lenders will withdraw the mortgage offer if the borrower can't get life cover, especially if they are the main earner and have no other protection, such as death-in-service benefit.
In her experience, cases where cover will be declined will include applicants who have suffered from cancer within the last three years or have recently gone through heart surgery. Recent kidney failure or morbid obesity would also cause big problems.
The good news is that only about 2 to 3 per cent of life assurance applications will be declined altogether, will about 10 per cent "rated" to take account of a health condition. This does not take account, however, of the delays that health conditions can inject into a mortgage process.
Past surgery can, for example, prompt insurance companies to call for a medical exam or doctor's report. And while the result may not affect the premium, it can eat up time at a stage where all parties to a deal are itching to complete.
