Home Buyers’ Guides | Mortgage Wise

How You Can Effectively Acquire a Mortgage even with Bad Credit

Mortgage lenders will definitely assess your financial situation inside and out if you apply for a mortgage. This is normal; after all, lenders would like to mitigate their risks as much as possible when taking on a mortgage applicant. A lender would need to make sure you can really afford to pay your mortgage, and one way they assess your credibility is by taking a look at your credit rating. If your credit rating is poor, you may be understandably worried. But don’t lose heart just yet – there are still ways for you to get that mortgage. Here’s how […]

Poor Credit Mortgage

Everyone who has ever borrowed money in the form of a loan or who has had a credit card or previous mortgages will have a credit record. It’s unavoidable not to have a credit record in this day and age. But your credit record can speak volumes about how you have handled your money and finances in the past and, more importantly, how you have handled debt. There is something called a poor credit mortgage that can be considered, but before you go down that path it’s important to get your facts right. Check it first The first thing you […]

How to increase credit score (when applying for a mortgage)

If you have a poor credit rating, you may be a bit worried about applying for a mortgage for your dream property. The fact is that lenders will always make it a point to check applicants’ credit ratings and histories, and if your history or rating is less-than-satisfactory, you could find it more difficult to get mortgage approval. But before giving up on your dream, you should know that there are ways through which you can improve and enhance your credit rating when applying for a mortgage. So, how to increase credit score? Let’s find out. Build it up Some […]

Mortgage Stress Test

The truth of the matter is that getting a mortgage is not easy, especially in this time when the market is more competitive, and lenders are stricter than ever. Acquiring the home or property of your dreams can be quite a challenge if you don’t have a very good idea of how to go about it in the proper way. For instance, before you even look for property, you should work out how you will pay the mortgage. This means working out how much you earn and how much you spend each month. Additionally, mortgage providers look at whether you […]

Can a mortgage broker get you a better deal

When applying for a mortgage, one of your most important responsibilities is determining if that mortgage is really right for your situation or circumstance. For instance, can you really afford it? Will the mortgage repayments allow you to still live comfortably and take care of all your other expenses? Will you be able to afford the mortgage plus other expenses associated with buying property, such as taxes and fees as well as the cost of moving? There are many reasons why you need to choose your mortgage very carefully. Finally, with all the considerations that need to be taken into […]

What is a Mortgage Broker?

Mortgage brokers are the middlemen in the process of loan applications. They are individuals with professional capabilities to work with you and the lender in order to secure a mortgage offer. The primary purpose of dealing with a broker is to find an expert who can help you go over the details of the application process as well as assist you in finding the best deal possible. Brokers can either work independently or be affiliated with a lender. Some brokers work under the recommendation of a few lenders but not from all. It’s always recommended to look for an independent […]

How Long Does a Mortgage Offer Last?

One concern raised by those who apply for a mortgage is the time it takes to be approved for a loan as well as how long the offer is going to last. The primary reason why approvals are delayed is that the borrower is not always prepared with all of the required information. Some borrowers try to get an estimated mortgage or a mortgage in principle in order to get an idea of how much they can borrow. This is helpful in shopping around for potential properties for sale that are within your price range. This is done by the […]

What is a Lifetime Mortgage?

Planning for a good retirement may not be the priority of some people. With living expenses taking a toll, saving up for old age often takes a backseat. When you have already paid up your mortgage and are nearing the age of retirement, you would want to think about how you can better enjoy your life. With no savings or retirement benefits, what other options do you have? You’re fortunate if you own your home because you can get a lifetime mortgage. A lifetime mortgage is a type of equity product with enough flexibility, and also ensures that you remain the owner […]

How Much Mortgage Can I Borrow with My Salary?

How much mortgage can I borrow? That is calculated based on 3 -5 times the value of a person’s annual income. A person’s ability to afford a loan was not given as much importance years ago to the point where lenders would not even ask for hard proof of a person’s income. Unfortunately, when the economy crashed years later, mortgage lenders had to employ stricter measures to avoid experiencing the same crisis again. What does this mean for someone who wants to take out a mortgage loan? You can expect that many aspects of your finances will be looked into with […]

What Mortgage Can I Get?

Owning a home remains the goal of many people. The same applies to most of the population in the UK. However, not everyone has enough disposable cash to build or buy a home. And if you live in congested cities like London, you are less likely to own a property unless you consider getting a loan. A mortgage is not necessarily an indication of a bad economy. In fact, the ability of residents to take out a loan indicates that financial institutions have confidence in their ability to pay. What mortgage can I get? The answer to this one depends […]

Can I get a mortgage with bad credit?

Can I get a mortgage with bad credit? Lenders are reluctant to offer mortgages to those with poor credit score as they would not want to be portrayed as encouraging you to take on more debt where there is potential of repayments not being made on time. It may be an idea to improve your credit score before applying for a mortgage. This can be done using a “credit builder” credit card in which you pay off the full amount owed each month to show you can manage your debts responsibly. However, these cards often how low credit limits and […]

How to get a mortgage

The first step in how to get a mortgage would be to sit down with us and discuss your circumstances and what type of mortgage you are looking for. There are several types of mortgages, each suiting different people’s circumstances. Fixed Rate Mortgage With fixed rate mortgages, your interest rate and monthly repayments will be fixed for a certain amount of time. This will mean you will know exactly how much you are paying each month for the term of the fixed rate. This would mean however, that your interest rate will stay the same even if other rates go […]

Different Types of Mortgages

Getting the right mortgage can be a confusing, if not a scary process and whether you’re applying for one the first time or planning for a remortgage, the different types of mortgages available make it harder to decide on the right one. The first step to figuring out the right mortgage for you is to understand the different types of mortgages that are available. The second step is to narrow down to a couple of options that seem suitable and enquire about them. Step One: Types of Mortgages explained There are different types of mortgages, including: Repayment Mortgages Interest-Only Mortgages […]

What do I need to apply for a mortgage?

In order to apply for a mortgage, there are specific documents that will need to be readily available. We will ask for these before we submit the full application to the lender. The specifics will be dependent on your circumstances and the lender of which you are applying to. What do I need to apply for a mortgage? A great place to start would be getting a copy of your credit report. Ensure you are registered on the electoral roll at your current address Ensure your address history is accurate Avoid payday loans and overdrafts where possible Different lenders will […]

How long does it take to get a mortgage?

How long does it take to get a mortgage? Well, that depends on a variety of different factors including: The type of mortgage being applied for i.e. a remortgage or a purchase The time it you takes to gather the necessary documentation for the application The turn-around time of the mortgage lender The turn-around time of your conveyancer The complexity of the mortgage application Typically, the process begins by getting a Mortgage Agreement In Principle. The mortgage lender will perform a credit search and agree a figure that they would be willing to lend you for mortgage purposes. However, […]

What is a mortgage decision in principle and how long does one last?

A mortgage in principle is an agreed figure from the lender that they would be willing to lend you. In order to do so they will gather basic information and perform a background credit search. A mortgage in principle is not a guarantee and a full application and assessment will have to be made before the lender can issue you with a mortgage offer. A mortgage in principle can last between 60-90 days depending on the lender. Because a credit search is needed, multiple decision in principles could have a negative effect on your credit score.

Mortgage in Principle & Mortgage Offers

What is a mortgage in principle and mortgage offer? A mortgage in principle is an agreed figure from the lender that they would be willing to lend you. In order to do so they will gather basic information and perform a background credit search. A mortgage in principle is not a guarantee and a full application and assessment will have to be made before the lender can issue you with a mortgage offer. A mortgage in principle can last between 60-90 days depending on the lender. Because a credit search is needed, multiple decision in principles could have a negative […]

What is a mortgage offer and how long does one last?

What is a mortgage offer? A mortgage offer, otherwise known as the “offer of advance” is the formal document issued by the lender to the borrower to confirm that they are happy to lend the agreed amount. So, what is a mortgage offer? Well, it is a binding contract between the borrower and a mortgage lender. This confirmation that the lender will provide you with a mortgage comes after the lender has fully assessed your circumstances and a full application is made alongside a valuation of the property. Typically that means that: you as a borrower have the appropriate income […]

What are the different types of house survey?

House Surveys House surveys are essentially assessments of a property that identifies major issues for a prospective buyer. House surveys are undertaken by chartered surveyors, who will visit and inspect the property and write up a report outlining any issues they have found. Homebuyers typically do a house survey after a mortgage offer has been accepted. Types of house surveys There are two main accrediting bodies for surveyors – RICS (Royal Institute of Chartered Surveyors) and the RPSC (Residential Property Surveyors Association). It is important to check that the surveyor belongs to one of the two bodies. In terms of […]

Niche Mortgage Products

Niche mortgage products are mortgages that are not run-of-the-mill and are modified to take into account special circumstances or properties. Examples of niche mortgage products are: Sub Prime Products Sub prime products are for people who do not fit high street lender’s lending criteria. This tends to be due to past credit problems such as missed payments, county court judgements or bankruptcy, which makes the borrower ineligible for standard mortgage deals. Sub prime products tend to have higher interest rates as the borrower is considered a higher risk. If you feel that you have credit issues or have been refused […]

New Build Mortgages

It is vital to get your timing right when it comes to new build properties and related mortgages as it is unlikely that you will be moving in straight away. You need to bear in mind that you will need a mortgage before you exchange contracts. It may be worth starting to plan your mortgage even before you find a property. The mortgage lender will need to be made aware that it is a new build property as there could be delays between exchanging contracts and completion. Without doing so, your mortgage offer could expire and the whole process will […]

What is an offset mortgage?

Offset mortgages are linked to saving accounts. You will pay interest on the different between the outstanding mortgage balance and the amount of savings in your account. For example, if you owe £200,000 in total and you have £50,000 in savings, your interest rate for that month will be calculated on £150,000. You are usually able to decide whether to keep the monthly repayments the same each month or to reduce them when the amount of offset savings increase. You are still able to access and use your savings however the more to offset, the faster the mortgage will be […]

Help to Buy Schemes

There are various initiatives, detailed below, which form the government’s “Help to Buy” scheme. The aim of which is to aid people with the build-up of deposit in order to buy a new home. Help to Buy ISA The Help to Buy Individual Savings Account(ISA) scheme involves receiving a government bonus on top of your own savings. This account is offered from a variety of banks and building societies across the UK to first time buyers on their first home A starting deposit of anywhere up to £1,200 can be made followed by a maximum monthly amount of £200. […]

What is a tracker mortgage?

A tracker mortgage is dependent on the Bank of England Base Rate, meaning when this fluctuates, your monthly repayments will also change accordingly. The interest payable on a tracker mortgage is usually a certain margin above the Bank of England Base Rate – for example the Base Rate plus 1.00% with some trackers having a “floor” of which the rate will not fall below. Lifetime trackers track the Base Rate for the full life of the mortgage. They tend to be at a higher rate than other trackers however due to not having to switch lenders or products every couple […]

What information do I need for my life insurance application?

In order for us to submit your life insurance application we will need the following information from you: Your height and weight GP details – including name and address Your medical history including details of any current or previous illnesses Details of any current medication or previous medication taken in the last 5 years Details of any family history of serious illnesses Your existing policy information – including provider, sum assured, term of the policy and policy number. Bank Account Details – for the account you wish the monthly premiums to be taken from. Once your application has been submitted […]

What is a variable rate mortgage?

The interest on a variable rate rises and falls as changes in interest rates occur. There are different kinds of variable rates offered by lenders including a standard variable rate, a tracker rate or a discounted rate mortgage. Your monthly mortgage repayments are most likely to fluctuate whilst being on a variable rate unlike those on a fixed rate for example meaning your mortgage repayments could be different each month. The rate you will pay is entirely dependent on your mortgage lender, with changes to it not necessarily being affected by the Bank of England Base Rate. Standard variable rate […]

Affordability

At the moment it is easy to lull yourself into believing you can afford the mortgage you need – mortgage rates are at all-time lows and feel easily affordable. However, you need to ask yourself not only can you afford it today but can you afford it in the future when mortgage rates return to more normal levels. Let’s say you manage to find a buy-to-let mortgage with an interest rate of three percent, fixed for three years. That’s a great rate. After three years you find interest rates have gone up and the best deal you can now get […]

Builders incentives – new-build ‘off plan’ offers

These may be attractive to the price you pay for the property. Be aware that some lenders may restrict the amount they lend in relation to these types of contracts. This helps protect them against market sentiment and may mean you have to invest more of your own deposit.

Deposit

Lenders are no longer happy to take all the risk of buying your next property, and so do not lend 100% of the value of the property. If you are unable, in the future, to pay your mortgage, the lender needs reassurance that it can take your home and cover the loan by selling it. Less risk taking means lower loan-to value (LTV) ratios, and personal deposits need to be larger than in the recent past. The source of the deposit may come from your current property, savings, inheritance or a gift. Be aware that deposit loans from family and […]

Gazumping

This is where the seller decides to take a higher offer, even after initially accepting yours. This could leave you out of pocket on expenses like the legal costs and survey fee. In England and Wales, the sale is secured by law only when contracts have been signed and exchanged. Under the Scottish system, the seller confirms his acceptance of the offer. If the seller then gets a better offer and wants to change his mind, his solicitor will refuse to act for him on the new transaction – as doing so would leave him open to charges of professional […]

Guarantor

A guarantor doesn’t have to be a parent but usually is. A guarantor takes on some of the risk of you being unable to meet your repayments. The lender will normally require your guarantors to offer their property as security against the guaranteed part of the mortgage. Technically they become immediately liable to repay the outstanding loan if you are no longer able to make your payments. In reality what usually happens is an agreement is made between the lender and the guarantor, so they maintain payments until you are able to do so. The amount of lenders willing to […]

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