We find that the vast majority of married applicants would much prefer applying for their mortgage jointly, as opposed to separately in their sole name. Property prices have often gone much beyond wage increases in recent years and a lot of the time, you need two salaries in order to qualify.
That being said, you may sometimes find that you are actually in a situation where one salary is enough to cover the amount that you are asking the mortgage lender to borrow. Additionally, an applicant may actually have their own specific reasons as to why they would rather apply in their sole name.
One of the reasons for a sole name mortgage application, could be that one of the couple has bad credit tied to their name, such as bankruptcy or perhaps a CCJ. This could prevent them for applying for a mortgage, even if they would like to.
In some of these cases, so long as the other half of the couple doesn’t have their own credit problems, they could still be able to apply for a mortgage in their sole name. This can also apply to business partners or friends.
The person who is eligible for a sole name mortgage would need to be wary of any future financial association to their partner. Any ties to them and their bad credit could affect your credit score drastically, lowering your chance of obtaining any future mortgage.
Other situations where one of the applicants may look to instead buy in their sole name, is if their other half happens to be unemployed for some reason.where an applicant may choose to go the route of applying in their sole name, can include if the other applicant is unemployed.
As a general rule of thumb, couples where one half is unemployed, actually may have a lower maximum borrowing capacity than if the working applicant had instead applied in their sole name. We do find this situation coming up quite regularly.
Applicant age can also be a factor in how much you can borrow. If one of the applicants is young but the other is say, in their 50’s, a mortgage lender may be hesitant to lend as much, due to old age risks through their term (a 25 year term would take you to your 70’s!) and worries with income.
That being said, if the younger applicant were to instead apply in their sole name, there could be the likelihood of borrowing more and benefitting from a wider variety of mortgage lenders and mortgage deals.
You may also find that there could be related tax implications or even stamp duty, which could lead to one half of the applicants instead looking at their options for applying for a mortgage in their sole name, rather than with a partner.
Depending on the circumstances you find yourselves in personally and financially, many mortgage lenders can be strict and for security in payments, can be much less likely to lend to married applicants in their sole name, if they otherwise would have a partner to borrow with.
You may also find that mortgages can be much more complicated if couples go on to get divorced, though thankfully there are plenty of mortgage lenders who are willing to let sole name applicants take out a mortgage, so there could be options for you.
Our experienced team are well-versed in providing our customers with specialist mortgage advice in Essex. We are open 7-days a week, so book your free mortgage appointment in Essex today and we’ll get started on your mortgage process.
By its own definition, a broker is a business that can arrange or negotiate for something in particular, on behalf of their client. A mortgage broker in Essex is a business that functions in that same way, for a homeowner, home buyer or landlord who is looking to take out a mortgage on their property.
A mortgage is a loan that you have secured against your property, which as a property owner, you will pay back over a particular length in time, through monthly mortgage payments.
Although a homeowner, home buyer or landlord are able to search for and apply for their own mortgage, you much more frequently find that they will look to utilise the services of a mortgage broker in Essex, because of the different services they can offer their customers.
Probably one of the most important jobs a mortgage broker in Essex can do, is that they are able to cross-reference your information against 1000s of unique products, across many different mortgage lenders. If you went directly to a bank, you will only be limited to deals from that company.
This isn’t completely a negative, as the best deal with that mortgage lender could still be the best one for you, but this can’t always be guaranteed. A mortgage broker in Essex is able to compare on your behalf, usually coming along with exclusive deals only available with that mortgage broker.
The job of a mortgage broker in Essex is more than this though, as there are lots of jobs that a mortgage broker in Essex can do, before and during your mortgage application and after your mortgage offer. They will also vary between companies; Not every mortgage broker works the same way!
For example, an area that we stand out in, is we are able to recommend suitable insurance options for our customers. Whilst it is an additional, optional cost (you don’t have to do it!), our mortgage and protection advisors have a duty of care to make sure you don’t lose your property, no matter the situation.
When your mortgage process begins, you will most likely be speaking with the appointment booking team of a mortgage broker in Essex. Their role will be to take some general information from you & help you to find a suitable time slot for you to speak with a mortgage advisor in Essex.
As an alternative to this, you are usually able these days, to bypass the need to call up first, as many mortgage brokers in Essex (much like ourselves) have a user-friendly and simplified appointment booking system online, where you can typically choose what type of appointment you would like.
Once you have gotten booked in, the next step will be to attend your mortgage appointment with your mortgage advisor in Essex. Generally you will provide them with some further information to help them better understand what you are looking to do, so that they can help you progress.
From that point, they’ll start looking at a variety of mortgage deals, to help you find the most suitable one for what it is you wish to do. Some mortgage brokers in Essex offer their customers a limited supply of obscure mortgage lenders, others offer more, with some offering a whole of market service.
Whilst we can’t say we are a whole of market company, we can confidently say that we have a greatly sized panel of mortgage lenders, with mortgage products that range from standard mortgage enquiries, to specialist, and everything else you’ll find in-between.
Your mortgage advisor in Essex will provide you with a recommendation on the deal they believe is right for you. If you like that deal, they will look to obtain an agreement in principle (AIP) for you. Our mortgage advisors in Essex are usually able to get this within 24 hours of your appointment.
Estate agents will want you to provide them with this when you make an offer on a property and it will also show the person that is selling the property that you are committed to the offer you have made and are in a position to go forward with the sale.
Also, when you are at this point, you will need to go ahead and submit your documents to the mortgage broker in Essex you are working alongside. The documents that are required can usually vary between each mortgage lender and what you wish to achieve in your mortgage process.
Standard document requests will include proof of ID, proof of your income and deposit, last 3 months’ bank statements and payslips, as well as proof of VISA or right to work in the UK, if you happen to be a foreign national (this is usually done with a share code if you have migrated from the EU).
Documents that are typically requested in more niche situations, include a P60 (not all mortgage lenders will need this), business bank statements and tax calculations/year overviews if you are a self-employed applicant, and possibly also an employment contract depending on what your job is.
After you have achieved all of the latter steps, a mortgage broker in Essex will then work to verify your documents and provide you with their mortgage illustration, which will detail the agreed deal before they move on to submission.
Following on with this, they will progress on to your mortgage application submission, to the mortgage lender. From there, it’s a bit of a waiting game until they get back in touch with your mortgage broker in Essex to confirm if you have been approved or not.
The work won’t be stopping there, as mortgage advisors in Essex still have further steps to complete. They will send copies of your documents to your mortgage lender, as well as liaise with solicitors. During this time, our mortgage advice team can recommend property surveys to you.
You will generally come across 3 different types of property survey. Basic valuation, which will work out the value and resale value of the property, home buyers valuation, which will goes a little more in-depth and a full structural survey, which alerts you to any areas that perhaps you need to look at.
Much as they had done when it came to your mortgage deal in your initial mortgage appointment, your mortgage advisor in Essex will be able to best recommend which property survey is right for you to have taken out.
As you wait for the conclusion of your mortgage application process, you may also have queries or concerns, about what is actually going on. Mortgage advice teams with good reputations will make sure you are informed regularly, often via email, so you are always in the loop with your mortgage progress.
Eventually, the mortgage lender will come back to us with an outcome on your mortgage application, hopefully a positive one! If your mortgage application is successful, you will then receive a formal mortgage offer from the mortgage lender.
From here, the job mostly goes on over to your solicitors to complete your mortgage deal, so that you can eventually be comfortable in your home. There is still more that a mortgage broker in Essex can do for you though.
Here at UK Moneyman, when you reach about the 6 month mark, before your mortgage deal is due to end, if you had previously took out your mortgage with one of our mortgage advisors, we will be back in touch to offer you remortgage advice in Essex and help you take the next mortgage step.
As is clear, there is much a mortgage broker in Essex can do for you, such as saving you time and money on your mortgage process, whilst they work to reduce your stress levels and bring you one-step closer to completing your mortgage.
We are proud to say that here at UK Moneyman, we really do care about our brilliant customers. After all, there is no Essexmoneyman, without you! We always put your best interests first, doing whatever we are able to do, to put you in the best position financially for your property goals.
To give you an example of this, if you wanted to take out a remortgage and got in touch with us for remortgage advice in Essex, but your mortgage advisor in Essex felt like you would benefit from taking out a product transfer, they will say so, as it is always about your best interests.
Furthermore, a mortgage broker in Essex may be able to get a mortgage lender to waive some of your mortgage fees, or maybe even look at incorporating them into your overall mortgage balance.
When you are in an appointment with one of our mortgage advice team, they will take a look through all of the costs and fees involved with your mortgage process, during your free mortgage appointment with a mortgage advisor in Essex.
Really, this is all down to you. If you would like to save time and money, stress and worries, then it may be beneficial to let an expert professional such as a mortgage broker in Essex, take on the bulk of the work for you.
We often find ourselves providing customers with expert mortgage advice in Essex, whether they be looking at first time buyer mortgages in Essex, to those looking for a buy to let mortgage in Essex and even more than that.
Book online today and speak with a member of our mortgage advice team, using our handy online booking feature, to benefit from a free mortgage appointment or remortgage review with a dedicated mortgage advisor in Essex today.
Taking the initial step onto the property ladder can be quite an intimidating process for some home buyers, especially if you’re looking to purchase a property by yourself.
To counteract this, we regularly hear from lots of First Time Buyers in Essex that are instead looking to buy a property with a friend or partner if they can do so.
When we look to calculate your maximum mortgage amount, lenders will factor in both your income and your co-borrowers’. Having two applicants means you’ll be splitting mortgage costs between you both, which can help increase your chances of getting offered.
It is very important to remember that if you were to default, your co-borrower could also be responsible for the full mortgage, and vice versa.
As an open and honest First Time Buyer Mortgage Broker in Essex, we have put together a collection of handy things we recommend to bear in mind when moving into a property with a friend or partner.
Depending on the lender that you go with, you may be able to co-borrow with up to four people jointly.
It’s important to factor in though that the more you have involved, the higher the chance of someone pulling out before the term ends. You should always be careful with whom you choose to buy a property with.
You may be able to increase your mortgage later if you prefer, though you and your co-borrowers will all have to agree. With that in mind, plan ahead for your future and your plans for the property.
Joint tenancies tend to be something that is more favoured by civil partnerships or married couples. If one half of the party were to die, the property would be immediately given to the other half. The way the law sees it, is that joint tenants are two halves of one whole, one borrower.
If either of you were looking to remortgage or sell the property, both of you would have to agree before proceeding with the mortgage.
Alternatively, if you and your co-borrower are friends or family, then it is a lot more likely that you will go down the route of ‘Tenancy in Common’. In this case, you both own your own part of the property.
You aren’t required to split your shares equally either. This means that if one of you are making a more significant financial investment than the other, you will own more of the property than the other.
Another reason that this works out well if you are a ‘Tenant in Common’, is that you have the freedom to act independently. What this means is that if you wish to sell or give away your share
A mortgage lender will make it clear that all borrowers are jointly and severally liable. If one of your co-borrowers decides not to pay their part of the mortgage, you will be responsible for keeping up the payments.
When you look to buy a home with your then other half, you never really predict that you’re going to split up before the term is up. After all, it is a large financial commitment to make anyway, let alone with someone else, and making any changes to it is not an easy process.
It is even more complicated when you factor in children, as it is likely that one parent will stay with them whilst you are left to move out and possibly find your own mortgage. In this case, whether you are the one staying or going, both parties will require the assistance of a mortgage advisor in Essex.
Whether the person has been paying the mortgage with the input of their ex or not, unfortunately doesn’t change the fact that it was applied for in a joint name. In the event of arrears, they will still chase both parties.
Before you can remove your ex-partner from a mortgage, the lender will need complete confidence in your ability to maintain mortgage payments and will reassess your income to make sure that this is the case, before they will proceed.
We regularly find that in the case of being unable to afford a mortgage alone, the mortgage applicant will instead apply jointly once again with a friend, family member or new partner. Mortgage advice in Essex is definitely recommended in these situations.
As touched upon above, in the event of potentially divorcing or separating your partner whilst on a mortgage, you are both still jointly liable for the property and its mortgage payments.
In this case, if you were the one leave and wanted to remove your own name from their mortgage, you couldn’t just make an agreement between the two of you, they would need to get in touch with their lender.
If you were looking to get a mortgage of your own, the lender would take into consideration the property you are currently tied to, therefore it’s important to make sure that you are removed off the previous mortgage.
You should always take out mortgage advice in Essex when faced with circumstances like these.
Some lenders will be more generous than other lenders, when it comes to how much they will be willing to lend you. Your dedicated mortgage advisor in Essex will take this into account when recommending the best mortgage lender for you to approach.
First-Time Buyers in Essex may find that their first experience of entering the world of home ownership can be stressful. It doesn’t always have to be that way though.
To help you make the most of any upcoming house viewings and to be as prepared as you possibly can be, we’ve put together a list of nine common questions that are worth asking when it comes to buying a house in Essex.
There is nothing wrong with taking your time to have a think about whether or not you would like to buy a property before committing to a purchase. It’s understandable, as doing something like this will be one of, if not the most important financial commitment you ever make.
A good starting point is to find out how many people have viewed or enquired about the property you have your eye on. This can give you a more accurate idea of how much time you have to ponder before making a final decision.
If it isn’t too popular, maybe you can take some time before deciding. If it’s popular, maybe you should decide sooner rather than later.
If the property is currently stuck within a chain, it may possibly cause some significant impact on different areas of your mortgage process.
If there is no onward chain, chances are your process will be able to continue smoothly, especially if you are not part of a chain yourself. On top of this, if the process is not reliant on you selling your property first, you will have more advantage as a home buyer.
This is because you will not have any part in holding up the home buying process. Definitely remember to mention this when negotiating a price with a seller.
Depending on who the previous homeowners were, you might find that they have left some items behind to save on costs. This could definitely benefit you.
The items generally left behind are what is called “white goods”. This includes things like washing machines, freezers, fridges and kettles. You may also find that the seller has left their shed behind in the garden.
If the appliances are all working well it is perfect for new buyers who are looking to save a bit of cash until they get their own items and modernise the place a bit. Alternatively, if you don’t want or need these items, it will be up to you to get rid of them.
On the flip side to this, if you are a First-Time Buyer in Essex, looking to buy a new build property, it is worth asking about optional extras. Doing so can see your new home potentially furnished, ready for when you are able to move in.
When you are moving into an area that you don’t know too much about, it is definitely worth your time to try and get a feel for what the neighbours are like, as a good or bad neighbour experience can often be one of the more vital “make or break” instances of your home experience.
Once again, if you are looking to move into a new build property, you and your neighbours will be the ones creating the community. This is a bit of a risk, as you will be building a neighbourhood from scratch with strangers.
Of course, first impressions are not the be all end all, but it’s always important to at least have a friendly dynamic with neighbours as you both will be presumably living next to one another for a considerable amount of time.
The running costs for the property you’re looking to live in can very much depend on the specific location in Essex, especially with it being a county. Therefore, it is important to do plenty of research and ask some questions.
For example, find out how much you could be looking to pay on council tax, as well as the average spend on utilities. This can generally be achieved by asking the seller or doing some online research.
Having this information will help you out when it comes to budgeting for a property.
Perhaps you are fond of relaxing in the garden on a late summers evening. Maybe you would even like to read a book in the natural light. Whether it is one of these or something else entirely, the direction that the house is facing can make quite the difference.
That being said, some locations can often mean that you have to pay a more premium price for a south-facing garden, due to the fact that they receive the most sun throughout the day.
Once again, this is a factor that can definitely have an impact on your budget. Therefore, it is important that you find out a bit more information about the following;
Making negotiations on the price of a property is a fairly standard part of the house-buying process. With that in mind, it’s essential to make sure that you are as prepared as possible to make any offers on a property.
It is also worth having a conversation with the seller or estate agent to determine what kind of offer may be considered too high or too low for the property in question. Find out if anyone else has made any offers prior to your enquiry, and if they’ve been rejected.
By putting aside a date in your diary, you will be able to put together a structured plan for your other jobs, such as instructing a conveyancing solicitor, boxing up all of your belongings and arranging a removal van to collect everything from your home and take it to your new one.
Fantastic! You have passed all of the required exams and have found great success in becoming a newly qualified teacher. Now it’s time for you to find a teaching job and get started in the classroom to rack up some experience.
In some cases, to be closer to that job, you may be required to look at moving home in Essex. If you own your own home already, you may benefit from the assistance of a mortgage broker in Essex.
Soon after you’ll be needing a new home to start a life in. Once here, you’ll be trying to balance the struggle of homeownership whilst finding comfort within your newfound role in the education system. This isn’t something you’ll be alone in, as we’ve dealt with many customers who feel this same way.
Hopefully with the help of a dedicated mortgage advisor in Essex, your process will go a lot smoother and quicker, reducing your stress.
The process of finding a lender who will be willing to offer a mortgage to newly qualified teachers can prove to be a little challenging. The reason for this is down to having little to no work history or being on a temporary contract.
Even though this is the case, you can worry less knowing that you may still be able to obtain a mortgage as a newly qualified teacher.
From time to time, some lenders may even offer good deals with those working within the teaching industry. The key to this is finding the best lender for your personal and professional circumstances.
This is usually the difficult part, though by enlisting the help of a mortgage advisor in Essex, you will be working with someone who can search thousands of deals and match you to the right lenders criteria.
The different types of mortgage available for newly qualified teachers generally include:
Here are some things that lender may consider during your process:
Our trusted and knowledgeable team of mortgage advisors in Essex have a lot of experience working throughout this industry, helping various people with the situations they are in relating to their mortgage. You’ll find there are lots of different benefits to home buyers using a trusted first-time buyer mortgage broker in Essex.
To take a look at your mortgage options, get in touch, and our dedicated team will take some details from you to determine whether or not you have the possibility of obtaining a mortgage suitable to your personal and financial circumstances.
Once you’ve had an offer accepted on a property, your lender will need to make sure that the house is worth what you said that you’d pay for it. They will do this by performing a property survey on the house.
A property survey will also show the overall condition of a property. If the property is in poor condition needs lots of work doing on it, your lender may lower the original amount that they were going to offer you as their mortgage offer doesn’t match the property price.
From minor damages to repairs that need action taken on them straight away, a property survey will show everything you need to know about a home before you move in.
There are three main types of property survey:
Each survey type is different in how they work, pricing and how long they take to carry out. In some cases, your mortgage lender may include a free property survey in your offer. This entirely depends on the lender that you’ve used as not every lender will offer this service free of charge. If a survey is included within your deal, you may end up paying slightly more for set-up/arrangement fees etc.
Each survey works differently, for example, one survey may go more in-depth than another. If your survey report shows something about your property that you weren’t told about, by law you are allowed to approach the seller and work out an alternative price if necessary.
These are the simplest types of property surveys. Mortgage valuations are performed to measure how much a property is actually worth.
If a Mortgage Valuation is carried out and it’s found that the property is not worth the amount that you’ve agreed to pay for it, your lender may withdraw their offer as they’ll be lending you more than the property’s worth. You can either try and re-negotiate the price with the owner or pay the difference between the offer and how much the lender is now going to lend you. This situation is called a down valuation.
This survey is the cheapest property survey; however, it won’t go into much detail. The survey will focus on obvious repairs and defects such as structural damages. It will not, however, show small, minor damages on the property.
For a report with further detail, you’ll need to upgrade your survey. Although this may be costly, in the long run, this could be worth it as you may find out everything that needs preparing in your home before further damage is done.
A Homebuyer’s Report will determine how safe the property is to live in. The survey looks at issues such as mould, damp walls and ceilings or things that do not pass the current building laws.
The property will be examined from top to bottom, inside and out. The surveyors will look at everything. This process could take up to a day on a large property.
As a mortgage broker in Essex, we would always recommend a Full Structural Survey if you want a detailed report of the home that you’re buying. We would particularly advise those buying an older house to take up this survey too as it will highlight major repairs and damages in the property. Older buildings are more likely to come with defects and damages.
Although a Full Structural Survey is the most expensive property survey, it will provide you with the most information about the property. The report will go in-depth, highlight the overall condition of the property, and show what changes will need to be made if the property purchase goes through.
A Full Structural Survey can take as long as a whole day depending on the size of the property.
If you are buying a new build property, property surveys work a little different. You’d think that since the property is new, you wouldn’t have to get a property survey carried out on it, however, it’s always best to do one just in case.
There is a property survey designed for new builds called a Snagging Survey. This survey will break down the property’s overall condition, pointing out both minor and major issues. The survey can point out something as simple as a missing door hinge to a crack in the ceiling (which is unlikely to find in a new build).
If you’re moving into a new build that’s already been built, it would be wise to get a snagging survey carried out on the property before you move in. This will give you the power to negotiate pricing if there is anything wrong with the property.
If you’re struggling to choose a property survey, our mortgage advisors in Essex are always here to help!
Get in touch with our mortgage team. We’ve helped thousands of First Time Buyers in Essex and Home Movers in Essex choose the best property survey for their new home, let us help you next.
You can obtain the services of a surveyor to carry out a Homebuyers report or building survey through the Royal Institution of Chartered Surveyors.
A fixed-rate mortgage is a mortgage that has been fixed for a particular set length of time, with the interest rates remaining the same for the entire duration.
Generally speaking, people within the mortgage world believe that the longer you fix your mortgage for, the higher that interest rate is probably going to be. With that in mind, if you are looking for the lowest rate possible, you should really look at taking out a short term fixed-rate mortgage.
The downside to a short-fixed term, is that you will be reaching the end of your term a lot quicker, meaning you will need to renew a lot sooner than you might have wanted. When the time comes to take out a remortgage in Essex, your monthly mortgage payments might be a lot more than they were before your term finished.
If you would rather not be searching for new fixed-rate deals every two years, but also have a preference to not reach the point where interest rates go too high, you might be better suited for a medium-term fixed rate mortgage.
Five-year fixed rates are some of the more popular choices that we come across when speaking to first time buyers in Essex, as they will provide you with the security of consistent monthly payments for the rest of your term. The downside with this one, is that if interest rates drop whilst you’re locked into that fixed deal, you will end up paying more overall than you otherwise would have had if you had gone with a shorter term.
The flip side to that, is if interest rates go up during your term, you’ll be sat comfortably at that lower rate for the duration. It’s because of this, that lenders may increase the interest rates on shorter terms, to future proof themselves, just in case. Usually, the longer your term, the more expensive it is going to be.
There are only a select number of 7 to 10-year fixed rates available to home buyers on the property market. These have always been the least popular of the choices, due to how long they are overall. Many feel that having a decade-long term is too long to be fixed in for a mortgage.
On top of interest rates, you will also need to consider the booking and arrangement fees that are involved.
A booking fee is payable upfront, whereas an arrangement fee is only payable on completion of the mortgage. You might know people who have added fees to the total of their mortgage amounts, but this of course increases the total amount you’d be paying off at the end.
Sometimes you might also find that your financial circumstances can suddenly change and you might need to repay your mortgage balance a lot earlier than had initially been planned for. When this happens, you will likely end up being charged for it.
This charge is known as an Early Repayment Charge (ERC for short). The ERC is calculated as a percentage of the amount that remains on the mortgage balance. If we say as an example, the mortgage amount you have remaining is £200,000 and you are able to pay that off earlier on into your term, with a percentage that is 2%, you would end up having to pay back £4,000 to cover the broken fixed contract.
Many homeowners aren’t aware of the Early Repayment Charge and think it’s as simple as paying off their fixed mortgage early. You are tied into a contracted deal and you can’t just jump out of it and pay it off early, unless you are quite content having additional large charges added to your account.
People who know about the charge may opt to just pay it off early anyway, in order to get a better deal that is currently on the market, especially if it is a limited offer that may not be available a few months down the line.
As an experienced mortgage broker in Essex, we would highly recommend that you avoid chasing after “headline” deals. Always make sure you remember that the lowest rates tend to come with the highest setup fees. Please get in touch today for any further fixed-rate mortgage advice in Essex.
A 95% mortgage is as simple as the name would suggest; you are borrowing against 95% of the price of a property, and then you are covering the remaining 5% with your deposit. An example of this is if you looked at buying a property that was worth £150,000 with a 95% mortgage, you would be putting down £7,500 as your deposit and borrow the remaining £142,500 from the lender.
Off the back of the March 2021 Budget, Boris Johnson announced a Mortgage Guarantee Scheme for mortgage lenders, making 95% mortgages more readily available from the bigger high street banks.
This is fantastic news for First-Time Buyers and Home Movers alike, as this scheme will continue running until December 2022. Certain terms and conditions will apply though, which is something your Mortgage Advisor in Essex will be able to look at, to see if you qualify.
All our customers who opt to Get in Touch will receive a free, no-obligation mortgage consultation where one of our dedicated mortgage advisors will be able to make a recommendation on the best possible route for you to take.
95% mortgages are usually accessible by both First Time Buyers in Essex & those who are Moving Home in Essex. Whilst saving for a 5% deposit sounds like a pretty straightforward concept, you’ll still need to have an acceptable credit score and prove that you are able to afford your monthly mortgage repayments, in order to access a 95% mortgage.
A good credit score is essential in the process of obtaining any mortgage, especially a 95% mortgage. Things like paying any current credit commitments on time, ensuring your addresses are updated and checking that you’re on the voters roll, can all help with your credit score.
Affordability is another one that is important to take note of. By giving the lender details of your income and monthly outgoings (things like your bank statements will be necessary for this) and any pre-existing credit commitments, your lender will be able to get a general overview of whether or not you are able to afford this type of mortgage.
Nowadays we see lots of family members helping each other get onto the property ladder, especially parents looking to further their children’s lives. The way this usually happens is by gifting the person looking to find their home, the deposit required. Known through the industry as the “Bank of Mum & Dad, Gifted Deposits are only intended to be a gift, and not as a loan. The lender will need proof that this has been agreed, before it can be used towards your mortgage.
When looking for a 95% mortgage, you want to make sure you have the right type of mortgage. Each mortgage type works differently, with that choice allowing you to find one that is most appropriate for your personal and financial situation.
Some homeowners and home buyers prefer Fixed Rate or Tracker Mortgages, mortgage types which mean you either keep interest rates at a set amount for the term given or have your interest rates tracking the Bank of England base rates.
Alternatively, you might find that Interest-Only or a Repayment Mortgages are more your style. Interest-Only allows cheaper payments until you need to pay a lump sum at the end (mostly now used for Buy-to-Lets), whereas a Repayment mortgage (a normal mortgage if you’d like) means you’ll be paying interest and capital combined per month.
Seeing as a mortgage is such a large financial outgoing, you need to be prepared and need to be aware. You might find things like higher interest rates, remortgaging difficulties due to less equity and then negative equity all cropping up if you’re not.
There is no need to worry though, as all these can be avoided if you’re savvy enough with your process to begin with. The more deposit you put down for a property, the less risk the lender will see you as.
A larger deposit, of say 10-15%, would not only reduce the rates of interest by a noticeable amount, but would also give the property more equity and reduce the risk of negative equity, thanks in part to you borrowing less against the property.
So, whilst the risks may seem intimidating, planning ahead and saving for a bigger deposit to access something like a 90% or even an 85% mortgage will be a massive help in your mortgage journey and something you’ll be able to reap the rewards from in the future.
Every mortgage lender has their own different way of deciding who gets accepted and who doesn’t. Some lenders criteria are hard to match up against and some are a little easier, it all depends on how strict they are and the quality of your credit score.
Often we see that mortgage applications are declined simply because a customer does not meet the right criteria. It’s reasons like this why we feel you’ll truly benefit using a Mortgage Broker in Essex, like ourselves. Our team of dedicated advisors will work hard to get you the most appropriate lender for you and your circumstances.
Firstly, before you apply, you should check your credit file to see whether or not it is in a good state. If it is not, then you may need to try and improve your credit score. There are lots of different ways that this may be possible, as listed in our article, though we will always recommend that you speak to a Mortgage Advisor in Essex to know exactly what to prioritise when working to improve your credit score.
It’s worth noting that only very few people are realistically eligible for every deal that is available on the market. This means that most of the time, people are just searching for the wrong deals for what they’re looking to do. Just because you have seen a cheap deal, doesn’t mean that you will pass the lenders criteria and qualify for it.
As an experienced and dedicated Mortgage Broker in Essex, we advise that do some research into the different types of mortgages available or Get in touch to benefit from a free mortgage consultation.
Something else we see regularly is customers using price comparison websites to find a mortgage. Whilst there may be nothing wrong with this, you need to remember that the price comparison websites can only check the different costs of a deal, not match you to all the nuances of a lenders criteria.
You can end up wasting a lot of time, as it can be weeks down the line of an application sometimes when a mortgage lender finally declines your case. Because of this, you may end up losing your property and/or breaking down a property chain. You may also find yourself getting declined because of picking the wrong mortgage, which in turn could damage your credit score due to a failed application.
Customers may find themselves being eligible for various deals, but in order to match the criteria for them, may end up being offered reduced deals. This seems to happen quite often, as the lender will first say that you can borrow a set amount and then later on change their mind and find a way to reduce the mortgage that were previously available to customers.
As mentioned, lenders all have their own unique way of doing things. You will often find that there is a huge difference between lenders and it’s very unlikely that you are going to match up against all of their criteria. You need to narrow down your options and work out what your best option will be.
Whether you’re a First-Time Buyer in Essex or Moving Home in Essex, we believe that getting in touch for some expert mortgage advice will be incredibly beneficial to you and your mortgage process. Not only will we support you from start to finish, through your journey, but we will also try to find you the most appropriate mortgage deal for your personal circumstances.
Over the years we have worked with thousands of specialist mortgage cases and been able to help customers who maybe feel down on their luck, find a level of success with mortgages that they never thought they’d achieve.
Approaching a trusted and dedicated Mortgage Broker in Essex, like Essexmoneyman, you’ll also be able to learn how best to improve your credit score, in the event of any unfortunate financial circumstances.
Need help with a Specialist Mortgage situation? Get in Touch today with a Mortgage Broker in Essex for a free initial mortgage consultation.
A gifted deposit is money given to a homebuyer to buy a property and can equate to some, or all of their deposit needed, with an understanding that you don’t need to repay the person who gave it to you.
Gifted Deposits are beneficial when you can afford your monthly repayments but struggle to afford the initial deposit; this is common for lower-income people. Having more gifted deposit available may also enable you to receive conceivably better rates from a mortgage lender.
It’s usually birth or adopted parents and carers who can gift you the deposit. You may have come across this referred to as the “Bank of Mum & Dad”. Additionally, other family members could also get acknowledged. It depends on the individual lenders, so your dedicated mortgage advisor in Essex needs to be accurate.
We often find that customers don’t know that their parents can support them out with their mortgage or don’t have the confidence to ask for help. Some parents will be more than happy to help their children, it’s a massive chapter in there lives, and their gifted deposit will allow them to live a sheltered life in a property they can call home.
Generally speaking, buying a house is a long term commitment. However taking out a mortgage often works out better than renting, you could potentially be paying less per month. Although parents can sometimes gift it earlier on in life if they already have enough saved or have released a certain amount of equity from their own home, the deposit usually is from inheritance.
Most lenders will not accept a loan to pay off your deposit. It comes down to the lender being uncertain that you’d have enough disposable income to pay back both the loan and the mortgage concurrently.
There is no maximum limit on the amount that someone can give you as a gift, with more deposit often giving you better rates, at least one lender that insists you put in at least 5% deposit from your income.
The people who reap the most benefits from this tend to be First Time Buyers and Home Movers in Essex. It can also be beneficial when used in conjunction with the Help to Buy Scheme, as the required 5% deposit, depending on the lender, can be paid via gifted deposit.
For the most part, all lenders will require a gifted deposit form. Depending on the lender, you may ask to provide additional proof and ID (things like donor ID or bank statements).