A mortgage in principle, known more commonly as an agreement in principle (AIP), is a helpful tool to estimate how much you could borrow before formally applying for a mortgage.
It usually involves a soft credit check, so your credit score is unlikely to be affected, and you are under no obligation to proceed.
At Londonmoneyman, we can usually obtain an AIP for our customers within 24 hours of their initial mortgage appointment. The AIP typically lasts for 30-90 days, but if it expires, we can help you renew it.
To obtain a mortgage agreement in principle, you can either contact a mortgage lender directly or seek the help of a trusted mortgage broker in London, like us. You can book a free mortgage appointment with our expert mortgage advisors in London by getting in touch today.
During the appointment, you will need to provide details about your income, employment, credit history, and other personal information to assess your eligibility for a mortgage and get an estimate of your borrowing capacity.
Our team can usually obtain your AIP within 24 hours of the initial appointment.
Prior to beginning your property search, it is recommended to obtain a mortgage agreement in principle to estimate how much you can borrow, which will prevent you from looking at properties that are out of your budget range.
Furthermore, having an agreement in principle can give you a competitive edge when making an offer on a property, as sellers and estate agents may consider you as a serious buyer.
An agreement in principle is not a guarantee of obtaining a mortgage, but it is a useful aid during the home buying process.
To obtain an agreement in principle, a mortgage advisor in London will require personal information from you to forward to the mortgage lender.
This includes your personal details such as your name, date of birth, and current address, as well as your employment status and income details.
Mortgage lenders will also need to know about your regular outgoings, credit history, and affordability, to determine your eligibility for a mortgage. It is important to note that further documentation, such as bank statements or proof of income, may be required before a final decision is made.
An agreement in principle (AIP) is a document that shows how much a mortgage lender may lend you, based on the information you’ve provided. Do remember though, it does not guarantee that you’ll receive a mortgage offer, nor does it mean there is any legal obligation for you to proceed.
On the other hand, a mortgage offer is a formal offer from a mortgage lender that confirms their willingness to lend to you after conducting credit and affordability checks. This is one of the final stages in the mortgage process.
If you accept the mortgage offer, it becomes a legally binding document that sets out the terms and conditions of your mortgage, including the interest rate, the term of the mortgage, and any associated fees and charges.
To get to this stage, you will need to provide the mortgage lender (through your mortgage broker in London, if you choose to use one) with more detailed information and undergo a full credit check. Additionally, the mortgage lender will require a valuation of the property you intend to purchase.
Once you receive your mortgage offer, you can proceed with the property purchase, subject to meeting any conditions specified in the offer.
In summary, an agreement in principle provides an estimate of how much you can borrow, while a mortgage offer is a legally binding agreement between you and the mortgage lender that sets out the specific terms and conditions of your mortgage.
Typically, obtaining an agreement in principle for a mortgage will not have a significant impact on your credit score. This is because most mortgage lenders only conduct a soft credit check during the AIP process, which does not leave a visible mark on your credit report.
It’s important to be aware that some mortgage lenders may perform a hard credit check as part of the AIP process, which can leave a visible record on your credit report. If you apply for multiple AIPs with different mortgage lenders in a short period of time, this could potentially impact your credit score.
It’s important to keep in mind that a mortgage application itself will usually involve a hard credit check, which can also affect your credit score.
Therefore, it’s generally advised that you limit the number of mortgage applications you make and only apply for an agreement in principle when you are serious about purchasing a property.
Obtaining an agreement in principle for a mortgage can provide several benefits for you when it comes to the home buying process.
Firstly, it allows you to determine the amount you can realistically borrow, helping you focus your property search within your price range. This can save you time and prevent the disappointment of finding a property that you cannot afford.
Secondly, having an AIP can give you an advantage over other buyers. Sellers may be more inclined to accept an offer from someone who already has an agreement in principle, as it demonstrates that they are a serious buyer actively seeking a mortgage.
Finally, an AIP can help expedite the mortgage application process once you have found a property you wish to purchase. Since the mortgage lender has already assessed your financial situation and eligibility, they may be able to process your application more quickly and efficiently.
Overall, obtaining an agreement in principle can be a valuable tool for anyone looking to buy a property, as it provides clarity on how much you can borrow, increases your chances of being accepted as a buyer, and can streamline the mortgage application process.
Getting an agreement in principle for a mortgage is usually free. It’s just a document that specifies the amount a mortgage lender is willing to lend you based on the information you’ve given them. You are not obliged to make any financial commitment with an agreement in principle.
If you are declined for a mortgage agreement in principle, it indicates that the mortgage lender has determined that you do not qualify for the amount of mortgage you have requested. There may be various reasons why this has occurred.
It is crucial to identify the cause of the rejection. You may need to reassess your financial situation or credit history, or you may need to provide additional information to the mortgage lender.
In some cases, it may be necessary to look for a different mortgage lender who is willing to lend close to, if not the full amount that you are seeking. Keep in mind that being refused an AIP does not automatically imply that you will be denied a full mortgage application.
When you submit a complete application, the mortgage lender will examine your financial situation and credit history more closely, and they may offer you a different amount or a different type of mortgage.
Moreover, applying for multiple agreement in principle with different lenders can have a negative impact on your credit score. As a result, it is important to conduct research ahead of time.
Having a mortgage broker in London can help you in locating the right mortgage lender, hopefully on your first attempt.
If you are considering first time buyer mortgages in London or home mover mortgages in London, it is advisable to speak with a mortgage broker in London to obtain your agreement in principle, before making any offers on a property.
Our team can typically secure an AIP for you within 24 hours of your initial mortgage appointment, providing you with valuable information as you progress through the mortgage process.
Book in for a free mortgage appointment today and we’ll work to obtain your agreement in principle as soon as possible, as you embark on your mortgage journey with the support of a trusted mortgage broker in London.
A CCJ is a County Court Judgement, which is a court order that you will be issued if you fail to back money that you owe. A CCJ can look very back on your credit file and can often impact your ability to get a mortgage.
If you have a CCJ attached to your name and were hoping to take out a mortgage, you should seek specialist mortgage advice in London. We recommend this so that you get the chance to speak with a professional who will be able to find out whether it is still possible for you to get a mortgage or not.
As a mortgage broker in London, we can take a look at your situation and work out what is the best option for you. Our mortgage advisors in London are specialised in complex situations like this, we can take a look at a variety of factors before looking at whether you can get a mortgage or not. These factors may impact your ability to get a mortgage:
You will receive a CCJ if you fail to pay back money that you owe. It doesn’t matter how much you owe or have already paid off, if there was a deadline that you missed, it’s likely that you will be faced with a CCJ. Unfortunately, even if it is only a small amount you have not paid off, you can still receive a CCJ.
If you receive a CCJ, you will get a 30-day period to pay it off (satisfied CCJ). See this as a final warning; if you manage to get it paid off within this timeframe the CCJ may be removed from your credit file, however, if you fail to meet this deadline, the CCJ will remain on your file for a total of 6 years (unsatisfied CCJ).
A CCJ can leave a very bad mark on your credit score, so we would advise that you try and pay it off within this period.
In some cases, yes it is still possible to get a mortgage with a CCJ in your name. With the help of an expert mortgage broker in London, you might just be able to get over that completion line.
If you managed to get the CCJ stripped from your records by paying off the money that you owe within the 30-day window, your chances of getting a mortgage will have increased. If you failed to meet the payment deadline, your chances may have been lowered.
Generally, often depending on the size of the CCJ and how much is left to pay off, the longer that you have the CCJ, the less of an effect it will have on your ability to get a mortgage. For example, if you have just been issued a CCJ, it will be very hard to get accepted for a mortgage, whereas, if you were issued with a CCJ 4 years ago, you’ve managed to pay off what you owe and you have been keeping on top of your finances, it’s more likely that you’ll be able to get a mortgage in London.
If you consider the lender’s point of view, they would be lending to someone who could not meet a previous credit commitment. A mortgage is one of the biggest financial commitments that you will ever make, so they are just being wary and making sure that you can actually afford to take a mortgage in London out.
As a mortgage broker in London, we are able to access specialist mortgage lenders that hold deals available to applicants with CCJs. To speak with a specialist mortgage advisor in London and find out whether or not you are able to access these types of mortgage products, get in touch with our team at Londonmoneyman today.
If you receive a CCJ that was wrongly issued, with sufficient evidence, you may be able to remove your CCJ from your records.
Reopening the case can cost you however, so you need to make sure that you have enough evidence to prove that it was wrongfully issued. If you manage to get it removed, then it will massively benefit your credit file and your chances of being able to get a mortgage. The CCJ will be completely removed from your credit history and your name.
To appeal your CCJ, you’ll need to complete an N244 form and send it to the court.
Your unsatisfied CCJ will eventually be removed from your file after 6 years have passed since the date that it was issued. As mentioned before, the longer that a CCJ has been in your name, the more likely it may be for you to be able to get a mortgage in London. You must know that this also means paying back what you owe, preferably as soon as possible.
The quicker that you pay off the CCJ, the better. If you have a CCJ in your name, but you paid it off years ago, your chances of getting a mortgage may increase. Not all mortgage lenders will think like this however, some mortgage lenders will not even work with you if you have a CCJ.
Rebuilding your credit score is the first step to getting a mortgage with a CCJ in your name. Keep making your payments and try to pay your CCJ off as early as you can.
There are many different ways to improve your credit score and you may need a few years to rebuild it, however, it will pay off. If you need to point in the right direction of where to start with rebuilding your credit score, our specialist mortgage advisors in London would be happy to help. Simply give us a call or ask us a question online.
The UK government designed the Shared Ownership Scheme with the intention of helping individuals to purchase own property. This type of mortgage is available to permanent UK residents, including both first time buyers in London or former homeowners who are finding it difficult to purchase a new home.
In order for you to be able to qualify for a Shared Ownership mortgage in London, your household income must be less than £90,000. This may differ in other areas of the country.
Additionally, you will almost always be purchasing your property on a leasehold basis, which means you will be purchasing it for a set period of time.
Under the Shared Ownership Scheme, you are able to purchase a portion of your homes value, via your Shared Ownership mortgage in London. The percentage that you purchase will typically be between 25-75% of the property value.
The remaining portion that you don’t purchase will be paid as a rental cost, including any service charges or ground rent, which will be charged at a lower cost than market value and is paid to a local housing association.
The Shared Ownership Scheme went through some fairly significant changes in April 2021, as part of the UK government’s Affordable Homes Programme. These changes are particularly noteworthy if you’re familiar with how the scheme once worked.
Among the changes to this, the minimum percentage that is required for a property share purchase was lowered, meaning in some cases, you can purchase as low as 10%, down from the previous 25%.
Furthermore, it is now possible to purchase shares in 1% increments, as opposed to previously where you could only purchase 5-10% minimum.
In addition to the latter, the fees that typically come along with purchasing these extra shares has also been reduced, with maintenance and repair costs typically now being covered for the first 10 years of your home ownership, by the landlord, rather than yourself.
If you had previously taken out a Shared Ownership mortgage in London before these changes took effect, it is entirely possible that these new rules could actually now apply to you, but it’s always recommended you check with your mortgage lender first, as this may still vary per case.
Before you look at taking on the mortgage side of your process, you will first need to make sure that you can even qualify for Shared Ownership in London. In order to do this, you’ll first need to contact with your local Help to Buy agent in the area you wish to purchase your home in.
When you speak to this agent, you will usually need to provide them with various bits of information, such as what your income is, the amount of budget you have, which area your preferred property would be in and your credit history.
Once your eligibility is confirmed, it’s time to make a start on your mortgage.
A trusted and experienced mortgage broker in London would most likely be your best port of call when it comes to this, as not every mortgage lender offers deals on a Shared Ownership in London. The amount you can borrow typically depends on things like income and other fees included, such as rent.
As is often the case with most mortgages, there are both pros and cons to having a Shared Ownership mortgage in London. To give this a balanced view, it’s worth noting as said above, that not all mortgage lenders will offer mortgage deals to those using a Shared Ownership in London.
That being said, there are still more than enough mortgage lenders out there, including ones we have on panel, that can offer these types of mortgages. Furthermore, Shared Ownership mortgages in London can offer a sense of long-term stability, as you become both owner and occupier, simultaneously.
Deposits may often be an area of concern, especially for first time buyers in London, as saving for one can be challenging. Thankfully, deposits for Shared Ownership mortgages are typically much lower than they would be for open market purchases.
Whilst your deposit may still need to be, for example, 5%, it’ll only be 5% on the shares you’re purchasing. If you only want to purchase a 50% share, you’d be paying 5% on whatever 50% of the property value is.
Shared Ownership mortgages in London also make mortgages more accessible to those who are perhaps on a lower wage bracket.
Whilst these positives sound good, you have to remember that you would also be you would be paying for ground rent and service charges. Typically speaking, you can take part in “staircasing”, where you buy more shares as time goes on, when you come into the funds.
In most cases, you will be able to purchase up to 100% of the property price, where at this point, you would no longer need to pay a monthly rent. That said, your mortgage, ground rent and service charges would still apply. In other cases, you may only be allowed to purchase up to 80%.
Further to the last point, once you hit the 80% mark or higher, you will have to pay stamp duty land tax, though if you’re a first time buyer in London, this may not apply, depending on where in London you’re going to be living. Speak to a mortgage advisor in London to learn more.
Even though stamp duty can prove to be quite a costly addition to the other fees you will already have, your monthly mortgage payments can still be much cheaper than paying for an outright mortgage. It can also even be cheaper in some regards, than privately renting.
Speaking of privately renting, you will also benefit from having a tenure security, unlike you would going private. So long as you maintain all of your monthly mortgage payments, you will be able to remain within your home for your lease’s duration, which is typically between 99 and 125 years.
Because your home will be part owned by someone else, you will need to obtain permission from the appropriate housing provider prior to making any structural changes to your home. This can take away a sense of freedom you would otherwise have, by owning it outright.
After you have owned your home for a while, you may eventually decide that you do not wish to remain there and look to sell the property, before you look at moving elsewhere. With the majority of mortgage types, this would be fairly simple, so long as you have gone through your fixed period.
When it comes to Shared Ownership in London, it works a little differently.
Your ability to sell a home with a Shared Ownership mortgage in London will entirely depend on how much of the property you actually own, from the shares you have purchased. You’ll typically need to own 100% of the property, before selling the property can be an option for you.
It is important that you remember, however, that the housing association generally receives ‘first refusal’ rights, for the first 21 years after you have purchased your home. This means they are, by law, able to make a property purchase offer to you, before you put it on the open market.
If you do not own 100% of the property, you will have to look at purchasing all of the remaining shares, before you can look at selling the property.
A Shared Ownership mortgage in London can be great for first time buyers in London, who have been dreaming of getting their own property, but only have a smaller deposit to work with. Using a Shared Ownership in London can help you to achieve all of your goals.
That being said though, having a Shared Ownership mortgage in London can often prove to be a complicated journey and there can be a lot for you to work with, especially when you include all the potential fees. You must make sure that you are fully prepared and aware of all the contract details.
At the end of the day, it all comes down to personal preference. By booking in for a free mortgage appointment with a trusted and dedicated mortgage broker in London, you’ll get to speak with an expert mortgage advisor in London, with plenty of time to prepare!
You can learn more about a Shared Ownership mortgage in London by visiting the government OwnYourHome website.
When a mortgage lender asks to look at your bank statement, they will be looking for a variety of things. One of the main reasons for this is to confirm whether you are a responsible borrower who can manage your finances and maintain monthly mortgage repayments.
We regularly find ourselves being asked by mortgage applicants if gambling transactions look bad on their bank statements?
From splashing your cash on the Grand National once a year, to being a regular customer on internet betting websites, properly licensed gambling is not illegal. After all, there are many advertisements about gambling these days.
Gambling is seen by many as a hobby or pastime, though it’s also important to remember the tagline on all of those adverts, which is to gamble responsibly. This is key, ahead of applying for a mortgage.
Whilst it’s not up to a mortgage lender to tell you how to spend your money or that you should gamble responsibly, they themselves have a duty to lend responsibly and adhere to mortgage regulation.
If a mortgage lender needs to be careful who he lends to and prove to regulators that they are responsible, it is not too much to expect the same approach to an applicant and his finances.
Think about it from your own perspective; If you were going to lend money to someone, you would want to know that the person you are lending to is a trustworthy individual and adamant that they’ll pay you back.
As described at the beginning of this article, a mortgage lender cannot stop you from doing so because gambling is not illegal. Nor is it automatically guarantee that you are going to be declined, it can be possible to get a mortgage!
Where it can be difficult for applicants with gambling habits is that it is up to a mortgage lender to decide whether your transactions are reasonable and responsible or not.
Against this background, they will look at how often these transactions occur, how big these transactions are compared to the income of applicants, and the impact they have on your account balance.
If you only make smaller transactions on an infrequent basis, with minimal impact on your credit score, then a mortgage lender probably won’t bother them. On the contrary, larger, more frequent transactions are likely to be considered irresponsible and you could be rejected.
As we have looked at, a mortgage lender will be looking to see how you manage your finances in order to determine whether or not you can be a reliable borrower.
It is important to remember that mortgage lenders are financial institutions that tend to sell current accounts, overdraft options, credit cards, personal loans and more, so things like this will also play a role in your mortgage application.
The key for a mortgage applicant is how well you can manage these facilities. For example, having an overdraft and occasionally using it isn’t necessarily bad, though going over repeatedly will go against you.
They will also look for any missed payments on any personal loans you have and any undisclosed loans you have. You might be keeping up your payments, but failing to mention a regular outgoing won’t look great.
Finally, a mortgage lender may well consider how much of the month is spent overdrawn. Do you immediately go to credit on payday and spend the rest of the month struggling? How lasting is a mortgage for you?
The simple answer to this is just to be sensible and plan ahead if you can. Generally, a mortgage lender wants to see the last 3 months bank statements, to show your income and regular outgoings.
As such, if you are looking to apply for a mortgage in the future, you should be careful in advance. Take a break from gambling and showcase your bank account in the best light.
Your mortgage broker in London can help you during your mortgage process, as there may be mortgage lenders willing to take fewer bank statements.
The simple answer to this is just to be sensible and plan ahead if you can. Generally, a mortgage lender wants to see the last 3 months bank statements, to show your income and regular outgoings.
As such, if you are looking to apply for a mortgage in the future, you should be careful in advance. Take a break from gambling and showcase your bank account in the best light.
Your mortgage broker in London can help you during your mortgage process, as there may be mortgage lenders willing to take fewer bank statements.
Having said that, it is always important to be as careful as possible before applying for a mortgage because even lenders who are initially willing to accept less still reserve the right to request more if necessary.
Always ensure that you gamble responsibly! There is a warning for your financial and mental well-being.
If you are new to the mortgage world as a first time buyer in London applying for a mortgage, it is always recommended that you speak with a specialist mortgage advisor.
We are experienced in helping customers to obtain mortgages with bad credit, so even if your credit history doesn’t look great, there may still be options for you!
Once you have made an offer on a property in London, the next step of your mortgage process involves selecting a property survey. This is something that your mortgage advisor in London will help you with.
A property survey is carried out to determine the true value of a property. This can give the lender an idea of whether you have overpaid for the property. Depending on which type of property survey you choose, the survey may also highlight any damages in and outside the property and its overall condition.
If you have had your property survey carried out and it turns out that you are paying more than what the property is worth, your lender may down-value your final mortgage offer. This means that they reduce their initial mortgage offer (in your agreement in principle) to match the value that they think the property is worth according to the property survey.
In most cases, we recommend that you go back to your seller to try to renegotiate your offer, presenting them with your property survey. Hopefully, they will lower their asking price.
In some cases, they may want the full asking price, despite the property survey results. If this happens, you may need to make up the remaining total if you still want the property. If you cannot make up this amount, unfortunately, you may lose out on the property.
If you are a first time buyer in London and need further help with property surveys and understanding how they work, feel free to get in touch with our mortgage advisors in London, they will be more than happy to help!
Before you select a property survey, you will need to know the difference between each one and how different properties may require a different type.
The three main types of property surveys include:
A Mortgage Valuation is the most basic property survey, that will likely be carried out on all properties at the minimum. This survey will look at the true cost of the property and compare it to the offer that you have placed on the property and the mortgage you’re looking to take out.
This property survey is used for a mortgage valuation only, and will unfortunately not highlight any repairs that are needed on the property. During the survey, you may become aware of obvious defects, however, underlying issues and faults may not be brought to your attention. This is why sometimes getting a higher level of property survey can benefit you more.
A Homebuyers Report looks at structural safety and will highlight issues that need immediate attention. For example, if there is dampness existing within the property, it will be detailed within your Homebuyers Report. You will be given this report by an independent property expert.
To make sure that you are not two different property surveys, it is worth asking whether the mortgage company’s surveyor can carry out this report for you. It is also worth noting that a Homebuyers’ Report may take a few hours to complete.
This type of property survey features everything to do with a property. It included everything a Mortgage Valuation and a Homebuyers Report does, however, provides much more detail and insight into the property.
Depending on the type of property that you are looking to take out a mortgage on, a Full Structural Survey can take up to a day to complete.
As a mortgage broker in London, we would recommend that if you are looking at buying an older property, you should take out a Full Structural Survey on the property before buying it. Older properties tend to cost more to repair, therefore, you would want to know about these costs prior to purchasing the property and discovering the repairs needed further down the line.
If you are a first time buyer in London or moving home in London, we are here to help you select the right property survey for you and the property you are looking to buy.
We want to make sure that you make the right decision so that you know everything about the property before buying. In some cases, this could help you save money!
We are looking forward to hearing from you and helping you with your mortgage in London.
During the first few stages of the mortgage process, following your free mortgage appointment, your mortgage advisor in London will give you a mortgage illustration. When you receive a mortgage illustration document, this means that your advisor has found a product that they think is perfect for your personal and financial situation.
So, what is a mortgage illustration? In simple terms, a mortgage illustration is a document that outlines every detail of a mortgage product. When you receive a recommendation from your mortgage advisor in London, this document will include everything you need to know about this product.
As a mortgage broker in London, it is our job to help you find the perfect mortgage product. To find that product and present you with a mortgage illustration, you have to follow these steps first.
1. Book your free mortgage appointment online and provide your mortgage advisor in London with some of your details so that they can find the best deal for you.
2. Following your appointment, your advisor will begin searching 1000s of mortgage products in order to find one that matches your personal and financial situation.
3. Once they find a product for you, they will present their recommendation with a mortgage illustration outlining the deal.
4. If you are happy with the product and want to continue with us, we can begin preparing your mortgage application.
We aim to make this process as simple and as straightforward as possible. Especially if you are a first time buyer in London, you want the process to be stress-free and easy-going, just like us! That is what we are here to help with.
For a quick explanation of “what is a mortgage illustration”, watch Malcolm from MoneymanTV give his answer below. For videos just like this, check out our channel and subscribe for more videos!
Once you have received your mortgage recommendation, you will want to know all about the product and what it has to offer. Take a look at your corresponding mortgage illustration and you find the majority of these:
Your mortgage illustration will hold information on your fixed contract length, which lender you would be taking out the product with and sometimes your valuation fees.
In most cases, you will be charged a product fee – a fee for taking out a mortgage product. If you do not have to pay a product fee, this will be outlined in your mortgage illustration.
Your monthly mortgage repayments along with the total mortgage amount will be included in your mortgage illustration. Your interest rate will also be included along with the fixed term length.
Solicitor and legal fees are also included. As a mortgage broker in London, we will talk you through these when going through your mortgage illustration with you.
Most properties, especially older ones, will need a property survey before you can purchase them. Valuations are a way for the lender to determine whether the property is worth what you’re paying for it or now. Some surveys/valuations can be more expensive than others.
No, you do not have to continue with us and take your recommendation. However, it is recommended for a reason as your mortgage advisor in London has found one that perfectly matches your personal and financial situation.
If you choose to go elsewhere and find your own deal, unfortunately, you will not be able to take the deal with you.
Though we would love to say yes that it can, however it can’t. We can never guarantee any applicant a mortgage.
A mortgage illustration comes after your free mortgage appointment, therefore, you have not provided any documents to support income, source of deposit and affordability yet. You will need to show that you can afford to take out this product before continuing.
An agreement in principle (also known as an AIP) shows that a lender will let you borrow for them, given that you can back up your income, affordability etc. You will receive one of these following your free mortgage appointment to back up any offers you want to make on a property.
An AIP is not the same as a mortgage illustration. Remember that a mortgage illustration is a document outlining a mortgage product and an agreement in principle is a document saying whether or not a lender pre-approves your application.
As a mortgage broker in London, it is our job to help you find the most appropriate mortgage product based on your personal and financial situation. Whether you are a first time buyer in London or moving home in London, we are sure that you will find our service more than beneficial.
Remember that you will receive a mortgage illustration upon completion of a free mortgage appointment in London. This is simple and easy to book online. Answer a few questions so we can get to know you, then choose your preferred date and time and that’s it!
Over our past 11 years of working within the mortgage industry, we have helped thousands of First Time Buyers in London secure excellent mortgage deals. It could be you next!
As your Mortgage Broker in London, we will search through 1000’s of First Time Buyer mortgage deals for you until we find one that’s perfect for you. We will take both your financial and personal situation into account when trying to find you a mortgage, this way the deal will benefit you in both ways.
Due to a highly competitive market, First Time Buyers often struggle to secure competitive mortgage deals. However, this could also be down to not knowing where to look. As a Mortgage Broker in London, we have access to a panel of 38 different lenders each with their own unique deals that we can search through for you.
There are lots of different types of mortgages available on the market and sometimes the choice can be overwhelming. We hate seeing struggling First Time Buyers stressing about their mortgage and struggling to find a deal, and that’s exactly why we want to offer a helping hand.
We consider all situations at Londonmoneyman and we will try to get over any mortgage hurdles that we are faced with.
After working with thousands of First Time Buyers in London, we came across a lot of similar mortgage situations:
We have also encountered a lot of similar mortgage problems when starting the First Time Buyer mortgage process. Usually, the applicant has been turned away from their bank and we are faced with the same reason to why you were turned away. However, we aren’t letting it get in the way, a Mortgage Advisor in London will try their best to overcome these hurdles. Here are a few:
If this is your situation, it is important that you don’t keep applying to different lenders. This is because each time you get declined, a negative print is being left on your credit file. If you get declined too much, you could potentially lose all chances of getting a mortgage altogether.
It goes without saying that it can be costly to buy a new home. There are various costs that can add up, as well as different options every step of the way that you can choose from.
If you’re a first time buyer in London who is looking for mortgage advice in London, you’ve come to the right place, as this piece will explain many of the costs typically associated with buying a new home.
Only those that are selling a property are required to pay an estate agent. It should be noted that these fees can vary drastically between different estate agents. Often, these fees can be negotiated, particularly when there is a lack of properties available for sale.
The cost of surveys can vary depending on requirements, however, your mortgage advisor will be able to recommend the most suitable option for you.
Mortgage lenders will inform you of the value of the property you are considering buying. This enables you to determine whether it is worth the cost. This can cost upwards of £300, or may even be offered for free by your lender.
It is also possible to request a more detailed Home Buyer’s Report, which often costs in excess of £1000 for the most in-depth surveys.
As a guide, mortgages with low-interest rates are typically those with the highest fees. Mortgage arrangement fees can vary between being free, or even costing upwards of £3000.
Mortgage advisors in London are in the best position to explain the most cost-effective products that align with your requirements, working out the total amount to pay throughout the product term, including fees.
It is usually possible to add arrangement fees to the mortgage. In this case, it will prevent a costly one-off payment; however, there will be interest on the fees, which end up costing significantly more over the mortgage term.
It is essential to have a solicitor take care of the legal aspects of buying your home. Your solicitor needs to be on ‘panel’ for the lenders you require, so make sure your choice facilitates this. Your mortgage advisor in London will be able to guide you throughout this process.
It’s also important to make sure that the quotes you consider for solicitors’ fees include local searches and VAT, preventing any unexpected costs from arising.
Stamp duty is a tax that is paid to the Government for some property purchases. This is paid to the solicitor upon completion, as they will pay the government for you.
For more information, visit: https://www.gov.uk/stamp-duty-land-tax/
When searching for a mortgage broker in London, it’s important to understand the applicable fees.
The majority of mortgage brokers in London charge fees, with the sum of money owed often being linked to the amount the lender pays the broker for carrying out work on their behalf. Many brokers only charge fees when they successfully get a formal mortgage offer for you.
Reviews are a great way to see other peoples’ experiences with a mortgage broker in London, which can help you to make your decision. As an example, if you find a mortgage broker in London with great reviews, this can give you confidence when choosing to work with them.
While some people choose to hire a van and move their own furniture and belongings into the new home, removal companies can take the stress out of this process.
While it does cost to have a removal company take care of this on your behalf, they can speed up moving and enable you to focus on other things, making your move more enjoyable!
This piece should have given you plenty of useful information, helping you to understand the basics of mortgage advice in London and setting you on the path to getting started.
So you’ve done great thus far and saved a majority of your deposit, now what’s next? It’s time to get prepared for a mortgage! Below is a list of some helpful advice for first time buyers in London, in order to help you be prepared for a mortgage ahead of time.
Once of the most important things that you should do first, is make sure you get an up-to-date credit report. This is key, even before you get in touch with a mortgage broker in London. It’s always smart to ensure you have paid off any outstanding payments you have, even if you’re holding off for matters of principle – Whether it’s your responsibility or not doesn’t factor into your credit report, and if it is unpaid, it will go against you. Ensuring these are paid off will increase your chance of obtaining a mortgage!
It’s handy to to make sure you’re on the voters roll, as it would seem that also has a positive effect on your credit score. Closing down old credit cards helps too, so make sure you do that. Your dedicated Mortgage Advisor in London will be able to run through your credit report in the early stages, providing expert advice on the different ways you can make sure you have a great credit score!
Once you kickstart the home buying process, you’ll be asked to provide some photograph ID. Our customers usually provide things like a driving license or passport.
Your driving license can be used for your address too, though this is limited to be used for one of the options. What this means is if you’re using it for photo ID, you’ll need something else to assist with proof of address and vice versa. Any non-UK nationals now residing in the UK will need to show us a copy of their Visa as well to be able to proceed.
As mentioned, you’ll also need some documents that can prove where you live. The standard option for these is a utility bill or original bank statement that is dated within the last 3 months. Alternatively, like we said in the proof of ID section, you are able to use a passport or driving license for proof of address, but it can’t be used for ID as well if you do this.
Your bank statements should document your income and regular spending habits. It’s preferable that you don’t get too carried away leading up to this with things like gambling, no matter how innocent, as the lender may hold them against you. The same goes for going past overdraft limits and letting direct debits bounce. You must make sure you’re prepared.
The majority of lenders will ask to see your bank statements, as it gives them confidence that you take your finances seriously. The bank statements usually needed will showcase income coming in and bills going out.
As a First-Time Buyer in London, you will have to prove you have a saved deposit and document where this came from, for the purpose of anti-money laundering. It’s always best practice to limit moving money from account to account, as it makes evidencing the audit trail trickier. Lenders prefer to see your savings building up over time, so you’ll also have to prove and explain the appearance of any large deposits, say if you’ve sold a car recently.
In recent times, we often see that deposits are gifted by family members and is the most popular way forward for First-Time Buyers in London. These need to be evidenced also, with the “donor” being required to sign a letter confirming you do not need to pay this back.
When it comes to something like affordability, the most important thing is proof of income. Usually you will be required to show the last 3 months of payslips if you’re employed, with some lenders needing to see your most recent P60. Lenders may also take into account regular overtime, shift allowance, bonuses and any commission you make. If you have more than one employer (maybe you have a part-time job or are self-employed), lenders will also accept the earnings from each of those.
Nowadays, many applicants are self-employed and in need of expert Mortgage Advice in London. Self Employed applicants in London will need the help of an accountants to request their last 2-3 years’ proof of earnings from the Revenue. Our trusted Mortgage Advisors in London are able to talk you through what to download from the Government Gateway if you happen to control your own accounts
It’s always worth doing your homework and taking the time to write down an estimate of what your outgoings might be after you move to your new home. This helps put into perspective how much your council tax and utility bills will be, plus regular expenditures like food, drink and travel. It’s also able to show how much disposable income you’ll have free to use as payment towards your mortgage. Our team can send you our version of a budget planner before we go forward with our appointment, which will hopefully be able to help with this.
As you can see from all of the above, getting prepared for a mortgage is not always the easiest, but is far from impossible! If you put in the hard work from the start, staying patient and being careful, it hopefully won’t be too long, before things start working in your favour.
An Agreement in Principle (also known as an AIP or Decision in Principle) is where you pass a Lender credit score to qualify for a mortgage.
By obtaining an Agreement in Principle, you prove that you are ready to support any offers you make as a first time buyer in London. It may also aid in negotiating a lower price if you have one of these as it shows the seller you are serious and have the means to continue with the process.
The more frequently seen methods of credit scoring are via soft searches, rather than a hard search. These may still affect your credit score, though usually a hard search will be more likely to do this than a soft search.
The reason for this, is that a hard credit search leaves a credit footprint, whereas a soft search does not. Regardless, you can rest assured that whichever is used by the lender, is done with the best intentions.
Having your credit checked via a hard search every so often should not make too much difference. It becomes an issue if you take too many of these within a small amount of time.
On the flip side, if you know you have a good credit score and it’s the best path to take with a lender, this should not be a problem.
Whilst the prospect of this would be nice, there are no guarantees that having an Agreement in Principle will allow you to get a mortgage. The Lender will still require seeing all your documents and only then will an Underwriter make very final decision.
Often we find that customers contact us after they have been declined at application stage, due to missing some small print in their Agreement in Principle. You will need to provide ID to prove that your identity, payslips to prove your income and bank statements to prove you are smart with money, before a lender will offer your case.
Though you are able to make an offer without an Agreement in Principle, we would not suggest doing so. Any credible Estate Agent will want you to prove you can definitely go forward.
It is possible to obtain an Agreement in Principle within 24 hours of getting in touch with an experienced mortgage advisor in London.
Typically,an Agreement in Principle will expire after 30-90 days. The good news is that this doesn’t mean you should just apply for the first house you find. If your Agreement in Principle expires, it’s not a difficult task obtaining another ahead of making an offer.
Finding a mortgage only to be declined a mortgage can cause understandable disappointment. With this in mind, we recommend getting an Agreement in Principle as early as possible.
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Londonmoneyman.com & Londonmoneyman are trading styles of UK Moneyman Limited, which is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited is Registered in England, No. 6789312 | Registered Address: 10 Consort Court, Hull, HU9 1PU.
Authorised and Regulated by the Financial Conduct Authority.
We are entered on the Financial Services Register No. 627742 at www.register.fca.org.uk
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Londonmoneyman.com & Londonmoneyman are trading styles of UK Moneyman Limited, which is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited is Registered in England, No. 6789312 | Registered Address: 10 Consort Court, Hull, HU9 1PU.
Authorised and Regulated by the Financial Conduct Authority.
We are entered on the Financial Services Register No. 627742 at www.register.fca.org.uk
