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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.
Removing a name from a mortgage can be a difficult process, no matter if it is divorce, splitting up with your partner, or in a rare case just want to have a mortgage in one person’s name, as opposed to two.
There are advantages to having a joint mortgage, however, it may sometimes become a more appropriate option to remove a name from your mortgage. Our Mortgage Advisors in London are here to help, using their experience in dealing with this subject, to help many customers during a financial separation.
Look at the current situation from the lenders perspective. They may be able to see from your finances that you pay everything on time and have the funds to proceed, but it is still a big ask in hoping they will entrust the payment of your mortgage to one person instead of the two they originally signed a contract with.
For the sake of financial security, they would prefer to keep both names on the mortgage. This is so that if a situation like mortgage arrears or more seriously repossession occurred, they would have the options of chasing two parties to cover the repayments. If they were to allow one person off the mortgage, this would mean that they have half the chance to receive a payment.
This will all usually be worked out based on affordability. If the person wants to have the property in their own name, without their now ex-partner or housemate, they will need to go through all the original lender criteria checks to prove they can in-fact afford to keep up mortgage repayments alone and avoid potential arrears.
Where this may be possible can differ between mortgage lenders. With this in mind, you may benefit from the assistance of a trusted mortgage broker in London.
During this time, you may find yourself being advised to switch mortgage lenders and get a better mortgage deal in a sole name, in a bid to erase any ongoing problems. Our specialist advice in London team may be able to relieve some of your stress, please get in touch to reap the benefits of a free mortgage consultation.
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.
There are several reasons why a second mortgage might be worth considering:
Releasing funds for a second mortgage depends on how much equity you have in the home and this is where specialist mortgage advice in London may be able to help. Lenders have a standard variable rate which is also called Lender’s basic mortgage.
Once you understand that each lender has its own standard variable rate set, then you understand the need for shopping around to find a better offer. You can also opt for a further advance with your existing Lender.
If you live in a property and want to move elsewhere then Let to Buy option is for you. It helps you in moving home in London as well as lets you keep the ownership of your existing property for you to rent it out later. Your second mortgage will be for a new residential mortgage.
Being a parent, you are considering and looking for ways to help your children or grandchildren find a place on the property ladder. There are many routes that can assist you in purchasing home for your child.
Looking for a new home while having your name on an existing mortgage occurs in situations when an individual is getting divorce or separation.
Before making any decision about second mortgage, make sure you have right people advising and helping you through it. Your dedicated mortgage advisor will be able to help in checking thousands of mortgage offers on your behalf and proposing the most acceptable offer to you, based on your personal circumstances.
It’s never planned and it’s always devastating when it happens, however, when it comes to divorce or separation, there are a lot of legal and financial matters that will you’ll need to resolve before you go your separate ways. Unfortunately, things don’t always go as smoothly as anticipated and that’s why it’s better to know what’s to come rather than be unprepared.
Your Specialist Mortgage Broker in London has put together a list of the three most common questions that we get from customers going through a divorce or separation and need our help. We hope that this puts you at ease knowing that you aren’t the only one who has searched for advice in these hard times.
Buying a home together is a huge financial commitment, so as you can imagine, getting a name removed from a mortgage is not always easy. In fact, making any sort of changes to your mortgage can be hard unless you’re coming to the end of your mortgage term.
If there are children involved, things can get a little more complicated. In most cases, we see that the mum stays in the property, but either way, it may come down to whoever is “in situ” takes on the responsibility of the mortgage.
When you are trying to remove an ex-partner’s name from a mortgage, you’ll need to supply evidence that you’re going to be able to meet your mortgage payments on your own. Lenders will study your salary and your disposable income and then work out whether or not it’s realistic that you’ll be able to hold your own weight.
Your lender will also measure your ex-partner’s affordability and check whether they will be able to afford a mortgage on their own going forward. They will perform a full affordability assignment on both you regardless of whether you have kept up-to-date with your mortgage payments in the past or not.
You must know that since you joint bought the property with your ex-partner, your lender can pursue either of you in the event of mortgage arrears.
If you want to remove your name from a mortgage it’s a similar process to how you remove your ex-partner’s name. Although, in this situation, you are the one that is trying to vacate the property and move on which can sometimes cause some difficulties.
This may cause difficulties as you will need consent off your partner that you can take your name off the mortgage. Your lender will also perform a full affordability check on your ex-partner to check whether they’ll be able to afford their mortgage payments or not.
If you are given consent to remove your name off the mortgage and your partner is able to afford the mortgage payments on their own, it’s in no doubt that you’ll eventually start looking for your own place. If or when you do, you should know that your lender will take the mortgage payments from your old property into consideration. Some lenders will be generous, some will be strict. Finding the most suitable lender for you can be hard and that’s why we recommend in getting Specialist Mortgage Advice in London, especially when going through a divorce or separation.
In some scenarios, there may be someone there to offer a helping hand with the mortgage payments. More often than not, family members may help out or in other cases, there may be a new partner that is willing to step in.
If this is not your situation and you are planning to pay for your mortgage payments by yourself, don’t be ashamed of getting advice from an expert! Our Mortgage Advisors in London are experienced in this specialist field and know exactly how to help. Getting help with your finances or with removing your/ex-partner’s name off a mortgage could take a heap of the stress of your back. We want the best for you at the end of the day.
Yes, in fact, you can own multiple mortgages, however, before getting accepted for another mortgage, your lender will take a look at many different factors. When they are checking your file, they will be able to see that you are still linked to another mortgage.
They will check how much you are contributing to these mortgage payments and check whether or not you’ll be able to manage additional mortgage payments on top of them. Lenders will also factor in any other credit commitments that you have.
Lenders will also account for the risk factor, for example, how likely is it that your home is repossessed because you couldn’t afford your mortgage payments. They won’t take any risks either.
If you’d rather get an affordability check before you directly approach a mortgage lender, you can approach a Mortgage Broker in London like us. We will perform our own credit check and affordability measures to find out whether it’s realistic that you’ll be able to afford another mortgage.
We have Mortgage Advisors in London that specialise in this field, so don’t hesitate to get in touch with us. We are more than happy to help.
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.
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.
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.
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.
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:
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:
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:
When you get to the point where you are ready to move home in London and want to take another step up the property ladder, you need to think about putting your existing home onto the market and selling it.
Once the house has been sold, the equity in it (the difference between the amount at which you sell and your remaining mortgage balance) will be used as a deposit for your next home purchase. You are able to further top up this total as much as you want, be it from savings or a Gifted Deposit from a family member or a friend.
On the whole, a seller will always have a minimum asking price, though sometimes they are still open to other offers. The way that a home is marketed and presented will have a big part in terms of how quickly you are able to sell it. So, from the perspective of both the buyer and seller, you’re going to need to do some research about moving home. A good place to start off is with a look at how to sell your home quickly:
When it comes to choosing your asking price, you need to make sure that it is not way over the odds for the area of which the property is in. Just because the estate agent has told you the maximum price your property could sell for, it doesn’t mean that it will actually get sold at that price. Try not to be too unreasonable with it.
Within the first couple of weeks of your listing, you want to make sure it is attracting lots of attention. If the interest in your property seems flat for a while, it is probably down to your asking price so try lowering it.
If you have already found a home that you want to buy and you are still living within your current house, you need to try and sell it as soon as possible. That’s exactly why a fair asking price is a great way to kickstart the home moving process.
We have a lot of experience in the mortgage industry across our team of dedicated mortgage advisors. When looking at properties, one of the first things that we always notice is how the exterior of the property looks.
Making your home look aesthetically pleasing from the outside is the best way to engage buyers. This is the first impression you will make on a buyer, so you need to be aware of how your home looks to an outside eye, on the outside of the property.
Sometimes all it could take is something so simple and easy, like having a freshly jet-washed drive and a neatly cut front lawn. This shows that you care about the little things and truly look after your home. This may also get people to think that the interior of your home will also provide the same good feeling that the outside has done already.
Remember, you never get a second chance to make a first impression, so, to improve your chances of selling your home quickly, you should try to make it as appealing as possible.
Before you open up your property for public viewings, you need to make sure your interior is clean and tidy. This will help to make the home viewer feel warm and welcomed into your property.
Remove any clutter that is surrounding the entry to the property, both just outside on your doorstep/porch and in the hallway coming in. When your viewer walks in, you want them to feel like you have indeed look after your home. Buying a new door mat and checking that a doorbell works are all things that will be remembered by viewers.
Once you have tidied up your hallway, you should then tidy each room, one at a time. You should always spend extra time in your kitchen and bathroom as these are some of the most important parts of any house. Clear out anything unnecessary from cupboards and wardrobes, neatly stacking the things you have in there.
Being a smoker can be a hindrance, as sometimes the smell of smoke can linger. As such, if you are a smoker, it may be an idea to give the house a good airing before your potential buyer turns up to have a look around. If anything remotely smells smokey, get rid of it. Sometimes we become blind to smell we’re used to, so maybe get a friend to come and help you out with this.
Give all indoor doors a new lick of paint and polish their brass fixtures. Make sure everything can open and close correctly with no errors.
Allow sufficient daylight into each room as well, opening all curtains and blinds. Your home should feel nice and warm but not too hot that it’s unbearable. Test all lightbulbs to ensure they work correctly. An old-fashioned way of looking at things is to add the smell of “baking bread”. We believe all cooking smells should not be present and instead leave it smelling fresh and clean.
Although it may seem a challenging task, you should try and avoid having your children or pets getting in the way whilst your viewers are taking a look around your house. You want to ensure they feel completely relaxed and comfortable.
Another good way to help them feel at home is to decorate your home with some family pictures or paintings brighten the place up and remind them that this is a family home.
You should also let them explore on their own, without crowding them too much. Usually if there’s a couple, they will want to discuss between themselves too.
As mentioned before, your kitchen and bathroom should be completely clean and tidy. Anything that isn’t used regularly should be put away in storage. Your towels should be neatly stacked away and not left on hooks behind the door or thrown across the floor.
Make sure that you double-check everything you’re cleaning as well, as the whole house needs to be spotless from top to bottom. Make sure clothes are not lying around and the bedrooms have sufficiently dusted.
Wash all of your curtains, blinds, wipe down your walls and clean your floors and windows. All repairs should be up to date too and clean bedding put out onto the beds. Windows should be sparkling clean inside and out, allowing light in and showing off any nice views.
Investing in carpets for smaller rooms can be an inexpensive way of impressing the home viewer. Carpets make rooms welcoming and can show your viewer that the house is properly looked after.
People who are selling their home, often might not be aware that having empty space is sometimes good. This is because it allows the viewer to see the properties potential. For example, an empty wall in a bedroom could help the viewer visualise what they would like to do to that wall with things like paint, wallpaper, pictures, shelves and so on.
Anything that you are storing outside of cupboards should be put back into cupboards or just thrown away if you don’t need it. This can also help you prepare for your eventual move, as you’ll have less to pack because of it. Make lots of room on your kitchen worktops too and tidy up any pots laying about.
The way a garden looks can often be the deciding factor for many property viewers, as it’s normally the last thing that the viewer sees on their journey around your property. You need to make sure that have no rubbish piled up outside or random items cluttering what would otherwise be a nice sight. It’s important not to pile everything into your shed too, as generally the viewer will want to inspect this and see it’s potential.
It’s also important to make sure that your fences have all of their slats properly in place and are freshly painted or creosoted. People love seeing colourful gardens, so even flowers could really make the difference in whether or not the viewer truly sees it as a home. Anything to liven up your garden could really help you out with this. Removing weeds and dead flowers, cutting the grass, removing grass clippings are all essential tasks to complete.
People like people, so remember to be a welcoming and honest host, acting from the heart as yourself. They are just one set of potential buyers at the end of the day, so if one doesn’t like it, there will be plenty more who might.
Create a balanced view on all current problems that you have encountered with the house. As an example of this, if you had a problem with a leak, say how it was easy to fix and that it’s very unlikely to happen again down the line.
Estate agents will want to earn their commission by talking to the property viewers as much as possible, however, you need to remember that you know your property better than anyone, so try leading that charge yourself when you can.
Finally, remember the emotions attached to a home when someone buys it. If you have a family it helps to showcase that it has been a happy home for you, which in turn is sure to rub off on the viewers if they are thinking of raising a family there also.
When you’re buying a house, you need to prepare your mortgage application alongside your property searching. This process can be stressful and a little daunting, especially if you are a First Time Buyer in London and you haven’t been through this part of the process before.
When preparing your application, you will be asked to provide proof of your address. This will allow your lender or Mortgage Broker in London to check that you live where you say that you live.
When checking over your mortgage application, your lender will be looking to make sure that all of your addresses line up. They will check your identification, bank statements, bank cards and even your billing and shipping addresses of various store cards.
You need to make sure that all of your addresses are in line with one another. Your lender will be able to see when addresses don’t match and will pick up on it.
This may be easy to monitor if you are a First Time Buyer as all of your details should be registered to your parent/carer’s or rented address, whereas, if you are Moving Home, you may have to double-check all of your linked addresses. Then, once you move into your new house, you will need to change all of these linked addresses to your new one.
If you move home and forget to change your address, your bank statements, letters and bills may be sent to an old address. This can negatively affect your credit score.
For example, if you get a parking ticket and the letter is sent to your old home, you will not know about the payment. This payment will keep going up and up if not paid and you may receive a default on your file for not meeting the payments. This is why it is important to change your address when you move home in London.
Your lender may decline your mortgage application if there are multiple addresses linked to your name. They want to see everything in line and have no mistakes, such as spelling issues.
If your application is declined, that can also have an adverse effect on your credit file. During your next application, when your lender performs a credit search on you and your file, they will be able to see that you have been previously declined.
This will not work in your favour, and it will only get worse if you keep applying and get declined.
This is the point where you should speak with a specialist. A Mortgage Broker in London like us will help you prepare your mortgage application and make sure that you have your information correctly filled out before you submit it.
Applying over and over will only lower your credit score, which can severely impact your ability to get a mortgage or obtain credit in the near future.
If you are looking for Mortgage Advice in London, then feel free to get in touch with our brilliant team. We are available 7 days a week so that you can get in touch at a time that suits you. Put your work and personal life first, then give us a call and we can book you a free mortgage appointment with an advisor. We hope to hear from you soon.
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 London 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 London & those who are moving home in London. 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.
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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
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