Help to Buy Archives | Londonmoneyman

Gifted Deposits FAQ’s | Mortgage Advice in London

Gifted Deposit Explained | Mortgage Advice in London

During our time as an open and honest Mortgage Broker in London, we understand that sometimes scraping together a deposit, is one of the biggest hurdles for a First Time Buyer in London to get onto the property ladder.

We tend to find, parents, grandparents and on rare occasions, even friends who want to help the ones they care for get onto the property ladder. They’ll provide either a portion or the entire amount of the deposit to put down on a property and obtain a mortgage. Find out what gifted deposits are and how they work.

What is a gifted deposit?

A gifted deposit is money given by parents, grandparents, or friends to a homebuyer to use towards your deposit to put down on a property and obtain a mortgage. It can either be a portion or the entire amount.

The money given isn’t a loan and gifted deposits are given to you with an understanding that the money doesn’t need to be repaid.

How can gifted deposits help out? 

Gifted deposits are helpful to First Time Buyers in London. Mainly those who are financially capable of covering their mortgage repayments, but struggling to save up for the initial deposit.

We tend to find, that these situations happen quote often. Perhaps they’ll have larger outgoings, such as rental payments, home energy bills, and essentials. That there isn’t anything else left to put into savings for a deposit.

By receiving a gifted deposit, this will allow you to gain access to much better rates of interest during your mortgage process, especially if that gift is above the minimum 5-10% deposit requirement.

Who can gift the deposit? 

As we’ve said, it’s mainly parents or carers who can gift you the deposit. This is often discussed online using the terminology “Bank of Mum & Dad”, don’t let the name throw you off this can include adopted parents too.

Sometimes other family members may also be able to help out with a gifted deposit. Though this entirely depends on the mortgage lender that you end up with. That’s why it’s worth getting in touch to speak to a Mortgage Advisor in London beforehand.

Do your parents know you need help? 

We often hear back from customers who have no idea their parents can help with their mortgage! This is why we aim to inform and encounter more people to ask for some extra help, so more people can get a chance to get onto the property ladder.

The majority of parents are more than happy to help their children to find a home of their own, comfortably living as opposed to struggling whilst living in a rental property.
 
In some areas taking out a mortgage may save you more money per month than you would get from renting, of course, this depends on several factors, but in some circumstances, it can happen.

Gifted deposits can come from inheritance, although parents can sometimes gift it much earlier if they have enough money saved or have released equity from their own home.

Gifted Deposit vs Loans 

Some mortgage lenders out there won’t accept loans as a means of paying off your deposit. It will be often related to the lender not being so sure if you can afford to pay back both simultaneously.

Is there a maximum or minimum gifted amount? 

There are no limits to the amount that can be gifted to a home buyer, it’s worth remembering that some lenders will want you to have a minimum of 5% from your own savings.

The more you can afford to put down, perhaps combining savings and gifts, you’ll open yourself up to better deals. 

Who could benefit from a gifted deposit? 

We tend to find, that it’s normally First Time Buyers and Home Movers in London who will benefit the most from the gifted deposit.

A gifted deposit can be used to cover the initial 5% deposit for the Help to Buy Equity Loan Scheme. However, this will depend on the lender.

What proof is required? 

Your donor will need to sign a gifted deposit form stating that it is not a loan and is in fact a gift. Additional proof such as ID, address, and bank statements will be required.

Our Mortgage Advice Service in London 

As a fast and friendly mortgage broker in London, we aim to provide our customers with the highest level of customer service, through a fast and friendly Mortgage Advice in London service.

No matter your mortgage situation. When someone gets in touch with us for Mortgage Advice in London, we will consider all cases, no matter how complex, and try our best to find a resolution.

Book Your Free Mortgage Appointment 

A trusted and experienced Mortgage Broker in London is available seven days a week, from early on until late. Our Mortgage Advisors in London will be ready and waiting to offer their support at all times.

Book your free mortgage appointment today with an expert mortgage advisor in London and we’ll see how we are able to help you on your mortgage journey. 

 

 

Our 10 Step Home Buying Guide for First Time Buyers in London

We tend to find a lot of customers asking us about the process of being a First Time Buyer in London when buying a home. Below we put together an extensive list of the 10 steps that you will go through during the mortgage process. We want to make sure that you are in the best possible position to get you prepared for your mortgage journey.

Here are the 10 steps to the home buying process and to obtaining a mortgage;

Step One: Get in Touch for Your Free Mortgage Appointment

Now, it’s time to purchase a home and take out a first time buyer mortgage. Getting onto the property ladder will be one of the biggest financial decisions you’ll ever make. The entire experience can be a bit daunting, especially when you have had no experience before.

With the help of a dedicated Mortgage Broker in London, we’ll be able to help you along the process. We aim to take the stress away from you and work hard to ensure you come out with a suitable mortgage deal.

To speak with one of our qualified Mortgage Advisors in London, book your free mortgage appointment today. They’ll take a few key details and look at what you’re hoping to achieve, before starting your process.

Step Two: Mortgage Affordability Assessment

During your free mortgage consultation, we’ll be able to run through a Mortgage Affordability Assessment. Our Mortgage Advisors in London will go through your monthly income and regular expenditures, to determine whether or not you can afford the monthly repayments of the mortgage amount you’re looking to borrow.

The reason why doing an affordability assessment is essential before putting your application forward, with a lender, is because they need to be confident that you can afford your repayments. By avoiding the risk of arrears and potential future repossession, something the lender will desperately want to avoid.

A Mortgage Affordability Assessment is something the lender will usually check themselves, so our initial check will help save the time of the lender, ourselves, and more importantly you, from an application that may be declined due to failing on affordability. 

Step Three: Obtaining a Mortgage Agreement in Principle

During your consultation, you will be able to obtain a Mortgage Agreement in Principle. Which can help give First-Time Buyers in London a boost when making an offer on a property.

You may have seen this under a few different, but similar names. These include ‘Decision in Principle’, ‘Mortgage in Principle’, as well as the abbreviations ‘DIP’ & ‘AIP’. There is no difference between these, other than the name.

The purpose of a Mortgage Agreement in Principle is to document that you have passed a lender’s initial credit scoring system, either via a hard credit search or a soft search.

However, this does not guarantee you will be accepted on a mortgage but is a necessary document to have. Having an A.I.P. will show the seller of a property that you are serious buyer, possibly creating a possibility for price negotiations.

An A.I.P. can last anywhere between 30-90 days, and can easily be renewed once expired. Our Mortgage Advisors in London can usually get one of these turned around for you within 24 hours of your initial appointment.

Step Four: Finding the Right Solicitor

Following your Agreement in Principle, you will need to find yourself a Conveyancing Solicitor to help you with the legal proceedings of the homebuying process.

Your Conveyancing Solicitor will be able to handle; Contracts, provide any legal advice, conduct local council / authority searches, deal with the Land registry, and transfer the funds you have acquired to pay for your property. As you can see, you must make sure you can choose carefully.

Also make sure to note that Licensed Conveyancers are property specialists who can’t deal with complicated legal issues, whereas more general Solicitors offer a full range of services so can often seem more expensive.

Sadly, whilst we do not offer these services ourselves in-house, our dedicated Mortgage Advisors in London can refer you out to someone to is.

Step Five: Making an Offer on a Property

After speaking to a Mortgage Broker in London, passed the Mortgage Affordability Assessment, obtained an Agreement in Principle, and found yourself a Conveyancing Solicitor to handle the legal side of things. You’re now halfway through the process, next it’s time to make an offer on the property you wish to purchase.

With an Agreement in Principle, you will be in a much better place to negotiate on price. With the seller knowing that you have an AIP they may be more likely to sell to you than someone who is willing to pay the asking price but is unprepared. But this isn’t a guarantee.

Worst-case scenario the seller rejects your offer, you can work out a more reasonable offer or find yourself another property. If your offer got accepted, get back in touch with your Mortgage Advisor in London, and they will continue with your mortgage journey.

Sixth Six: Submit Your Documents  

Make sure to submit the required documents. Your lender will need you to provide various documentation, including the amount you earn from your job, where you live, and how you conduct your finances, are very important to the lender.

If you’re obtaining a joint mortgage, they will require this documentation from both candidates involved. The several types of documents you will need to submit, include; 

  • Proof of ID and proof of address
  • Last 3 months’ pay slips
  • Latest P60

As for self employed applicants in London you will need to provide; 

  • Proof of any income such as state benefits or maintenance
  • Proof of deposit
  • The last 90 days’ bank statements

Step Seven: We’ll Progress Your Mortgage Application  

With your mortgage agreed in principle, and your offer accepted, your Mortgage Advisors in London can now proceed to submit your full mortgage application. Having everything checked and ready by your Mortgage Advisor in London and Administrators, we are ready to submit an application to the lender for a mortgage.

Your Mortgage Advisor in London will send off all the gathered documentation for this, and then wait for them to respond with whether or not the application has been accepted or declined. Sadly, there is no given time frame, however, our Mortgage Administration team will be able to chase the lender for an answer on this for you.

Step Eight: Property Valuation / Survey  

During the process, the lender will require a valuation survey of your property to be undertaken. These are usually carried out by the lender’s choice. The valuation is to help understand the true value of the property.

If you’re paying above its actual market value, the lender may be less willing to accept your offer. Because they’ll be out of pocket and unable to make back the full borrowed amount. This terminology is also known as a ‘Down Valuation’.

Your Mortgage Advisor in London will be able to help you choose the right survey for you. Each surveyor comes with a different price. Some will just want to check the property’s worth, whereas some will also provide information on any structural concerns as well as possible repairs.

Step Nine: Receiving Your Mortgage Offer  

Once your lender has checked over your case and assessed all the evidencing documentation, they will present you with your Mortgage Offer.

Our team of Mortgage Advisors and Administrators in London will make final checks to make sure nothing got missed. Next, it’s down to your Conveyancing Solicitor to take your purchase through to completion.  

Step Ten: Completing The Process  

Now for the exciting part, you’ve now officially went from a First Time Buyer in London to a homeowner. By now, we hope you are happy and ready to begin your new life, in your new home.

Just have to wait for the key and moving-in date. We hope you found our service beneficial and received a fast and friendly Mortgage Advice service in London. If you have chosen a fixed-rate mortgage, at the end of your term, we will be in touch to help out once again with your Remortgage in London

Mortgages for Newly Qualified Teachers (NQT’s) in London

Newly Qualified Teacher Mortgage Advice in London

Once you have completed all of the required exams and can proudly shout about becoming a Newly Qualified Teacher, it’s time to look at the next step. For you, this will be to make use of your new skills and find yourself a job using your well-earned qualification!

Depending on whereabouts you are going to be working, you may need to start exploring the different options that are available for you with Moving House in London, as you could possibly be working further away from where you currently live.

Soon enough you will find yourself looking to live elsewhere, perhaps maybe finding it a little more challenging than you would’ve expected to create a balance between homeownership and getting into your new role.

This is not something only you will be feeling, however, as we have worked with a lot of home buyers and homeowners throughout our time as a mortgage broker, all of whom needed someone to take the stress away whilst they keep their minds on their new career.

Newly Qualified Teacher Mortgages

It’s not always so easy trying to search for a mortgage lender who will be happy to offer a mortgage to someone who is a newly qualified teacher.

Problems tend to crop up due to either the fact that there isn’t really any work history they can look at or because they only have a temporary contract.

Although these can be an issue, there are still plenty of options for Newly Qualified Teachers who are looking to obtain a mortgage. Our dedicated team of Mortgage Advisors have helped many NQTs in their quest for obtaining a mortgage over our time as a mortgage broker.

Every once in a while, you may find that there are some mortgage lenders out there who have preferrable deals specifically suited to public sector workers such as teachers.

The key to making sure everything goes to plan here, is ensuring that you are with the best mortgage lender for your situation, which in this case is usually what would be the most challenging part of the mortgage process.

When issues like this arise, our experienced mortgage advice team in London will step up, taking the time to search through thousands of mortgage deals for you, doing everything we can to find you the perfect deal for your situation.

What mortgages for NQTs may be available?

You should always bear in mind that whilst yes, mortgages can be complex for Newly Qualified Teachers, you are not completely restricted in what is available to you on the mortgage market.

Here are some of the types of mortgages that we find that crop up the most when we are working with cases referring to Newly Qualified Teachers:

  • Help-to-Buy Schemes – A scheme that was created by the government with an aim to help first-time buyers who are in the market for purchasing a new build home.
  • Fixed-Rate Mortgages – A mortgage type that comes up quite a lot and it allows you to make sure that your payments are the same all throughout your mortgage term.
  • Shared Ownership Mortgages – Partially rent payments, partially mortgage payments. You will start off owning only a share of the property, with the remaining share being owned by a relevant third party, such as a housing association. This may make your monthly outgoings easier to manage.
  • Tracker Mortgages – A variation of a variable rate mortgage, wherein the movement of interest on your mortgage coincides with the Bank of England’s base rate, regardless of whether that is up or down.

The lender may look at a handful of other factors as well regarding to NQT mortgages. There are some known mortgage lenders out there who do not need to see previous employment and may allow you to obtain up to a 95% LTV (loan-to-value).

Depending on the mortgage lender that you go with, you may find that a 12-month first contract is treated the same as a permanent job role, rather than it just being seen as a temporary contract.

Finally, there may be a selection of mortgage lenders around the country who are willing to get started on your mortgage before you officially start your job, though to do this you will have to provide evidence of a signed contract and a confirmation of your start date.

This can come in quite handy, as you may potentially be prepared to start making your first mortgage payments at the time when you are due your first months wages from your new job, by the time your mortgage has completed.

How a Mortgage Advisor in London may Help

Our open & honest team of dedicated mortgage advice experts in London have extensive knowledge and experience of helping customers across the mortgage and property markets, providing help to lots of first time home buyers with their mortgage needs

There are a great deal of benefits to using the services of a trusted Mortgage Broker in London. We always strive to take away your stress, looking through thousands of different and tailored mortgage deals for you, our customer, suggesting possible conveyancing solicitors for you to use and more.

Find out what you may have available to you as a first time home buyer, by getting booked in online for a free mortgage appointment with an experienced and reputable mortgage advisor in London, who will collect information from you and help you onto the next step of your journey.

How Much Deposit Do I Need to Buy a House in London?

Deposit Mortgage Advice in London

When buying a property, you will need to put down a deposit. This deposit amount can change depending on the property value, your credit score and your personal and financial situation.

Your lender will need to know that you are a reliable applicant, therefore, you will have to pass certain affordability assessments before your application is accepted.

A Mortgage Broker in London like us will help you prepare your mortgage application and make sure that you look the best that you can do in front of your lender.

Why do I need a deposit for a mortgage in London?

Pre-credit crunch era, you wouldn’t need a deposit to get a mortgage, in some cases, you’d be able to borrow 100% of the property’s price. Some lenders were even offering more than the actual value of the property, for example, you may get £125,000 for a £100,000 property. You can see where it all went wrong.

You are now required to pass affordability assessments before being able to borrow any amount of money this large. Lenders don’t want to be lending to someone who cannot afford to pay them back. The last thing that they want is to repossess your property.

Usually, you will need a 5% deposit minimum. If you cannot make this amount, you may need to ask for help through a gifted deposit or continue saving until you reach the required amount.

Can the government pay the deposit for me?

The government cannot pay for your deposit, however, there are schemes available that can help you increase your deposit amount.

For example, the Help to Buy Equity Loan scheme, allows you to make up a 25% total deposit. You will have to meet the 5% minimum deposit, then the government will top it up to make up a total of 25%. This scheme only applies to new-builds and you have to be a First Time Buyer in London.

The Equity Loan that the government lend you is interest-free for the first 5 years. Afterwards, you’ll start receiving interest on the amount left.

Is a 5% deposit enough?

Most high street lenders will ask for a 5% minimum deposit. If you’ve got bad credit, you may be asked to put down a higher percentage, e.g., 10-15%.

If you’ve got your 5% deposit and are ready to make an offer on a property, you will need to arrange a mortgage agreement in principle so that the estate agents are aware that you’ve been accepted by your lender. As an experienced Mortgage Broker in London, we are able to prepare you a mortgage agreement in principle within 24-hours of your mortgage appointment.

How much do I need to put down if I have a poor credit history?

Having poor credit may mean that you have to put down a higher deposit. Some lenders may ask for 10-15% of the property’s value. They need to make sure that you are a reliable applicant that can afford their mortgage payments before lending to you.

There are different ways to improve your credit score. If you try to implement these changes and show your lender that you’re trying to improve your finances, it will reflect better on your application.

How much deposit do I need for a Buy-to-Let property?

If you are looking at taking out a Buy to Let in London, you are going to need a minimum deposit of 25%.

When it comes to taking out your second, third or even fourth mortgage, you’re going to need a higher deposit, no matter what the reason is for doing so. Affording multiple sets of mortgage payments can be difficult, and that’s why lenders ask for more evidence so that they’re certain it’s within your limits.

Can I take out a loan for the deposit?

Despite this being possible, not all lenders will allow it. It’s rare to find a lender that is okay with this as you would have a 100% mortgage.

This would result in you having two sets of loan repayments going out, which could be difficult to manage.

Can someone gift me a deposit?

Yes, you can receive the deposit as a gift. Typically, buyers receive a gifted deposit from their parents or family members when they’re struggling to make up the minimum 5% deposit.

This must strictly be a gift and not a loan. The party gifting the deposit must confirm that this is the case.

As a Mortgage Broker in London, we see situations where the gifted deposit boosts the applicant’s deposit up to around 7 or 8%. This can make you appear more reliable and have a positive impact on your application.

Are there any circumstances where I don’t need a deposit?

There are some of the main situations where you may not need a deposit for your mortgage:

  • If you are buying a property as a sitting tenant from your landlord and you receive a discount
  • Your family member has given you a discount from the open market value
  • You qualify for a discount under the Right to Buy Mortgage scheme

Please note that the above information and guidance is for reference purposes only and is not to be viewed as personal financial or mortgage advice.

Mortgage Advice in London

Help to Buy & Equity Loan Remortgage Advice in London

Help to Buy Mortgage Advice in London

Market Update: Help to Buy Equity Loan & Shared Ownership

A Help to Buy introduction

In the time period that followed the credit crunch, during 2013, the UK Government introduced a new mortgage scheme with the intention of strapping a rocket to the property market and hoping to see it soar once again. This new scheme was called Help to Buy and its mission was to assist First-Time Buyers in London in finding their footing on the property ladder.

At long last, thanks to Help to Buy, there was confidence in the market once again. Things were not completely normal, however, as homeowners and lenders alike were still left a little cautious. Mortgage lenders were being very careful with who they lent to and how much they gave out to borrow.

There are multiple different Help to Buy schemes, with some going strong since 2013, and others that have not. One of most popular Help to Buy schemes is called the Help to Buy Equity Loan, a scheme that is still available to this day for customers to take advantage of if they need to.

Help to Buy Equity Loan

If you are an inexperienced First-Time Buyer in London, the Help to Buy Equity Loan scheme could be an incredibly helpful way to get yourself onto the UK property ladder. There are requirements, but they are quite straightforward;

  • You must be applying for a mortgage for on a newly built property.
  • You must be a First-Time Buyer. You used to able to access the scheme as a home mover, however this changed as of December 2020.
  • At application point, you must have a deposit of 5% or more.

It’s at this point that the Government will loan you up to 20% to make up the total of a 25% deposit. For example, if you have a 10% deposit, the Government will loan you 15%; you have 7% they loan 18%, and so the pattern continues.

Deposit & Equity Loan Estimates – Londonmoneyman

It is very important to remember that this Equity Loan is a loan and not just free money. This means that the loan will have to be paid back on top of your 75% mortgage. You get a period of 5 years to pay back this loan interest-free, though after these 5 years, you will start gaining interest on the remaining loan amount, starting at 1.75%.

Remortgage for your Equity Loan Repayment

You may have already accessed the scheme and have reached the 5 year period for your interest-free loan, unable to pay off the remaining balance before interest accrues. You may find the help from an expert Help to Buy Mortgage Advisor in London extremely useful as you may need to organise your repayments via the route of a Remortgage.

In taking out a Remortgage in London, it may be possible to combine your remaining mortgage amount and your equity loan amount into one set of monthly repayments. Once again, if you are struggling to meet your repayments, it may be worth your time speaking to a professional Remortgage and Help to Buy expert in London.

Shared Ownership

The Help to Buy Shared Ownership scheme was introduced as a means of allowing homebuyers to purchase a percentage of a mortgage and then pay the rest back with monthly rent repayments. The share percentage of the home that you buy will likely be between 25-75%. The remaining percentage on the property belongs to the housing association.

This means that you share the property and you don’t own every bit of it. The percentage of the property that you own can be increased further down the line. As an experienced Mortgage Broker in London, we usually find that people increase their share in the home once they have settled in or when they have more money spare to do so.

Help to Buy Mortgage Advice in London

If you are in need of Help to Buy Mortgage Advisor in London, our team are here to help. As a company, we have been helping struggling customers secure Help to Buy mortgages for many years now and know how to guide First-Time Buyers through the mortgage process.

Our advisors are available 7 days a week, so don’t hesitate to Get in Touch with us for expert Help to Buy Mortgage Advice in London.

Should I Use My Estate Agent’s In-House Mortgage Advisor?

Estate Agent Mortgage Advice in London

When you start your mortgage process, if you choose to use a large estate agent, they will want you to use their in-branch Mortgage Advisor and their recommended conveyancers.

You don’t have to use their in-house advisor however, in fact you can still get the same or better deals from somewhere else! Unfortunately, First Time Buyers are often the ones that get caught out and end up coaxed into using their internal services.

Searching for an external Mortgage Advisor in London could be the best path for you to take. An estate agent’s advisor will be biased, only encouraging you to see their side as they just want you to stay on with them.

A dedicated mortgage broker in London will be able to give you more perspective and see different sides. If you do your research and still end up back with your in-house advisor, that’s fair enough, though you should always remember that you have other options out there.

Our view consists of both transparency and efficiency, as we want to provide the best possible experience and the best advice for your personal and financial situation, whilst still delivering a fast yet friendly service.

Sales tactics of estate agents

If you end up choosing to use your estate agent’s in-house mortgage advisor and conveyancer, you need to think about where the cost of their service is coming from. Maybe they are charging you for their services without asking you and adding it to other fees, so that you don’t notice. Taking the route of a trusted mortgage broker in London will eliminate these concerns, as you know exactly what you are paying for. Your dedicated advisor will break each cost down for you and answer any questions of uncertainty you have with what’s going on.

Even though it is an illegal tactic, if you have opted not to take the estate agents in-house mortgage advice, they may refuse to put your offer forward on a property. For example, you could be using a broker and they may push another offer to completion over yours, purely on the basis that you aren’t using their services. Once again, these situations are illegal.

Estate agents may get even craftier and try to charge you with extortionate in-house conveyancing fees. Even with a straightforward purchase, they could try and charge you with fees upwards of £1,500. If you encounter anything like this during a purchase, you have all rights to ask them where they have got these prices from and for them to provide a full breakdown of everything.

An experienced mortgage broker in London only has your best interests at heart, and all of this can be avoided by going to one over an estate agent for mortgage advice.

How can I get a Mortgage in London?

Finding the right Mortgage Advisor

Choosing the right Mortgage Advisor can be hard; but is there a way to make it easier?

Sometimes your case will be specific and might require specialist care and attention. An estate agents in-house advisors don’t care about this and just want to make money off you. When you Get in Touch with a mortgage broker in London, you can be matched up with a specific advisor who has experience in that field.

For example, we have specialist buy-to-let mortgage experts who can be called upon if a buy-to-let enquiry is presented to them. Once you’ve had a free mortgage consultation and an agreement in principle (usually turned around in 24 hours or less), you could be linked with your perfect advisor and get a head start on your mortgage process..

We have years of experience providing mortgage advice in London and have been helping struggling customer take that leap into the mortgage market for over 15 years now as a company. You can find out more about our excellent mortgage advice service by looking at our fantastic customer reviews.

Getting behind the wheel to start your own mortgage journey

If you would rather “go it alone”, you should know that it’s perfectly okay to do so. The majority of things you need can now be done online! Along with the use of price comparison websites, you may be able to find yourself the most appropriate deal.

The benefit of doing things online is that you have the chance to save money on additional fees. As long as you are confident in what you are doing and know what you are looking for, you could complete the process very quickly.

One thing to note though is shopping around and comparing online may be a little harder than you think. You will need to make sure that you’ve found the most appropriate fit before agreeing to anything. Here are some things you should be wary of when choosing to find a deal by yourself:

  • Do you have the ability to match the criteria for the “Best Buy” rates? Check before applying, as if you are declined, this could negatively impact to your credit score.
  • Have you researched properly? Many of these comparison sites earn a commission from lenders and where there is no commercial relationship with a lender, they may choose to just not include certain deals on their list.
  • If it goes wrong, it could cost you a lot of money. Be aware of valuation and applications fees if you are not 100% certain that you have been accepted. These fees will not be refundable.
  • You will solely be responsible for progressing your application and also sorting out any problems if you encounter any future issues.

Should I use my Bank or a Mortgage Broker?

Using your bank’s Mortgage Advisor

It isn’t difficult to make an appointment with your bank’s Mortgage Advisor, however, it may not be the right choice for you to make. If you do choose this route, here are a few things you should keep an eye out for:

  • They won’t shop around for the best deal; they can only offer their own deals; some of their deals may not suit you at all! They also won’t tell you about other mortgage lenders cheaper rates.
  • You might be declined, even if you’ve been a longtime customer of that bank, regardless of length of time. We’ve seen customers of 20 years still get turned away for “lack of information”.
  • There can often a long waiting list for a mortgage appointment, with some lenders making customers wait around 6-months for an appointment.
  • Your bank may have inexperienced advisors on their team and therefore are unable to help with more complex cases. This is why many people get declined, as instead of solving the issue, banks instead just turn customers away.

Using a Mortgage Broker in London

Working alongside a mortgage broker that is not associated with the estate agent ensures you have someone working purely on your behalf as an inexperienced First Time Buyer in London. This also ensures there’s no conflict of interest risks.

Everything will be kept between you and your designated Mortgage Advisor in London. We have no external ties to any building societies, banks or estate agents. When we work, it’s solely for you and only you. Whilst we have lenders on panel, they’re purely there for the deals they offer, allowing us to find the most appropriate case for your case.

Our team have your best interests at heart. Managing Director Malcolm Davidson is here to explain the pros & cons of using a dedicated mortgage broker:

Why Should I Use A Mortgage Broker? | MoneymanTV

Need a Mortgage Agreement in Principle in London?

What is an Agreement in Principle | MoneymanTV

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. 

Will obtaining an Agreement in Principle affect Credit Score? 

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.

Should I avoid hard credit checks? 

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.

Is an Agreement in Principle a guarantee that I will get the Mortgage? 

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.

Can I make an offer without an Agreement in Principle? 

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.

How Long Does it take to get an Agreement in Principle? 

It is possible to obtain an Agreement in Principle within 24 hours of getting in touch with an experienced mortgage advisor in London.

How Long Does an Agreement in Principle Last For?

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.

Mortgage Market Update: Biggest Surge in Lending Since 2007

Mortgage Advice in London for 2021

Following on from the recent announcement made by British Prime Minister Boris Johnson, we felt it appropriate to share some positive news that came with the new lockdown rules.

Much like during the November 2020 lockdown, the property market is still open for business as usual. You are still able to take up house viewings, continue your purchase and put your home up for sale.

Below, we have a mortgage market update from the ‘moneyman’ himself, Malcolm Davidson:

Lockdown 2020 and Obtaining a Mortgage in London

Throughout the last lockdown, back during November 2020, there was a significant increase in the amount of mortgage enquiries banks and brokers were receiving. The boom in purchase approvals for homes reached an outstanding 105,000 in November, which was the highest recorded figure since August 2007.

Graphic: UK Moneyman | Source: Bank of England

In October 2020, purchase approvals were at 98,300. This increase of 6,700 is impressive when you think about where we were, working through the middle of a nationwide lockdown.

Obtaining a Mortgage in London During Lockdown 2021

In terms of the property market, the January 2021 lockdown is currently working on a similar level to the previous one we experienced back in November 2020. You are still very much able to start your mortgage journey in 2021. How you start this is completely your call.

Whilst some take the route to do this themselves, accepting the help of a dedicated and experienced mortgage broker in London can reduce stress, time and the possible cost of the matter, depending on what you’re looking to do.

January is always a popular time of year for first time buyers in London, moving home in London, landlords and so on, with more mortgage products becoming available again as time progresses. This is allowing for more mortgage options to those looking to invest in the property market.

90% Mortgages Are Still Available

Yes, thankfully 90% mortgages are still available and lenders are getting more and more confident in the UK property market over time. They know that the demand for properties and mortgages is still alive and well, and that people will only start coming back when they are confident that they can get a deal with a 5-10% deposit.

There are also other ways to access a 90% mortgage, through something like the Help to Buy Equity Loan scheme or the Help to Buy Shared Ownership scheme. If you want a Help to Buy in London to walk you through the process, explaining how these methods could help you obtain a mortgage with only a 5-10% deposit, make sure to get in touch and a mortgage advisor in London will assist you how in any way they can.

We Are Open as Usual!

The property market is still open, which means Londonmoneyman is ready for business as usual! We have a team of dedicated Mortgage Advisors in London available, 7 days a week, all throughout the year to help you along your property owning path to a mortgage.

Don’t worry, we still offer a free initial mortgage consultation to all customers who get in touch, no matter the situation.

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

The information contained within the website is subject to the UK regulatory regime and is therefore primarily targeted at customers in the UK.
Should you have cause to complain and you are not satisfied with our response to your complaint, you may be able to refer it
to the Financial Ombudsman Service, which can be contacted as follows

The Financial Ombudsman Service, Exchange Tower, London, E14 9SR
www.financial-ombudsman.org.uk

© 2022 Londonmoneyman

Londonmoneyman, Unit 3A, 34-35 Hatton Garden, Holborn, London, EC1N 8DX, UK

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