Hurdles Obtaining a Mortgage in Leicester
When you are going through the mortgage journey, there is a small chance that you will encounter some kind of issue. Sometimes, these can be challenging to deal with!
Having worked in the mortgage industry for over 20 years, we have a vast amount of experience as a trusted Mortgage Broker in Leicester, and have encountered a vast range of mortgage hurdles throughout the years.
This means that it’s very likely we have encountered your situation before and will have an idea of how to overcome it.
On the rare occasions that we haven’t encountered your circumstance before, we will work hard in finding the best solution to help you along the mortgage journey. The hurdles you may face can be ones you are unaware of especially if you are first time buyer in Leicester, however, we hope to help you with this.
With a plethora of mortgage hurdles out there, it would be a challenge to cover them all. Below highlights the top five hurdles you may encounter in the midst of your mortgage process.
Common Mortgage Hurdles
Childcare fees
Having your mortgage application turned away due to you having children is a rare occurrence, however, it can put you at a bit of a disadvantage if do.
The lender wants to be fully certain that you can manage all your mortgage payments as well as current expenditures. Childcare costs do come under the expenditure umbrella each month.
The reason why lenders have to factor this in is because these costs can often go into hundreds of pounds per month. Generally, childcare costs never decrease, they are always going up! From a lender’s point of view, childcare costs are the same as a car loan or hire purchase agent cost.
Regardless of if you don’t pay nursery fees, having children can mean you are offered less than other buyers who don’t have children. One advantage is that this type of family can usually be in receipt of tax credits and some lenders will acknowledge this along with child benefits.
Divorce/separation
In the unfortunate circumstance that you decide to separate from your partner, you may encounter some problems relating to finances, especially if you have one together.
If you are still financially linked with someone else, lenders may struggle to accept your application. This is because they don’t want you to have two different sets of mortgage payments to meet each month as it might be a lot to handle.
Our team often get asked the same questions when people reach out to us for specialist mortgage advice in Leicester, below are just a few:
- How can I remove my ex’s name from my mortgage?
- How do I remove my name from my ex’s mortgage?
- Can I get a second mortgage in Leicester?
If you are faced with mortgage hurdles like these, it can get very challenging, very quickly. The good news is that there is often a solution to these scenarios, it’s just working out the steps to overcome them. Having a Mortgage Broker in Leicester to provide a helping hand, you will have a lot of weight lifted in these difficult times.
Benefit income
When it comes to benefit income, different lenders will have varying viewpoints, one is how they are going to assess it. The good thing is that all benefit income like child tax credit, working tax credits, disability benefits and pensions can all be factored in one way or another. The lender decides whether to consider it or not.
Feel free to contact our team if you are looking for more information about mortgages and benefit income. Here at Leicestermoneyman, we will look over your situation for you and try to match you with a lender that will consider your benefit income, our goal is to get it right first time!
New Job
In many cases, a new job includes a larger salary. This additional income is usually put towards something like a new mortgage. You may think this means you have a higher chance of getting a mortgage, but this is not always the case.
It’s common to have a probationary period when you start a new job. Probationary periods are usually okay, but there will no doubt be some uncertainty there. You might a lender will only accept you when you have job security, it depends on the lender and mortgage costs.
To determine your work patterns, lenders will look at your previous places of employment. They need to know you aren’t jumping in and out of work. Gaps in employment can hurt your application.
You might find some lenders who will work from a newly signed employment contract even in month one or if your new job is about to begin.
Evidencing a deposit for a mortgage in Leicester
All mortgage lenders and mortgage brokers legally need evidence of where the borrowers’ deposit funds come from. This is to prove that the applicant has raised funds legally and to combat money-laundering. Your solicitor and estate agent may request evidence of your deposit also.
This is the part of the process we feel is the most complicated when applying for a mortgage and can result in some mistakes if not carried out correctly.
Your deposit might be from savings, premium bonds, the sale of another property, gifted from a family member or friend, from family overseas, or from a personal loan, either way, you need to have the paper audit trail for the accumulation of funds.
Date Last Edited: December 6, 2023
