Lenders have a very important reason for requesting access to your bank statements: they aim to gain a deep understanding of your financial habits and recent financial conduct.
Your financial management, as revealed by your bank statements, plays a central role in determining the amount a lender is willing to lend you, if they are willing to lend at all. This assessment primarily revolves around managing risk.
Lenders need to be confident that you exhibit financial responsibility and can manage your financial commitments reliably. This becomes especially significant because a mortgage represents one of the most significant financial commitments you will make in your lifetime, and it requires thoughtful consideration.
Acquiring your bank statements is a straightforward process, and there are various methods to obtain them. These include receiving physical copies by post from your bank, visiting your local bank branch to collect them, or accessing printable versions through your bank’s online platform, a convenience widely available in today’s digital banking landscape.
Now, let’s dive into the central question: What specific elements will lenders closely examine on your bank statements, and what might raise concerns from their perspective?
As previously mentioned, the primary goal is to assess your financial responsibility. One critical aspect under scrutiny is the presence of overdrafts. Occasional use of your overdraft facility isn’t necessarily a cause for concern. However, if you consistently exceed your overdraft limit, this could raise doubts about your financial prudence and reliability.
Lenders also pay attention to returned direct debits, which might suggest inconsistent reliability in meeting financial commitments. Additionally, it’s important to be transparent about any existing loans during the application process.
Failing to disclose them could erode trust with the lender, especially if they uncover undisclosed financial obligations on your bank statements. Trust plays a pivotal role throughout this evaluation.
Furthermore, it’s essential to maintain a track record of timely payments for personal loans and credit cards. Demonstrating your ability to manage your finances responsibly and meet monthly payment deadlines is likely to make lenders more inclined to approve a loan amount closer to your desired borrowing amount.
This is a frequent question that we encounter quite often. Many customers face challenges when they have a history of gambling activities.
While the occasional bit of entertainment through betting is harmless, engaging in frequent high-stakes gambling, whether it results in profits or not, can have a notable impact on how a lender perceives your financial situation. In such situations, lenders are unlikely to view your circumstances in a positive light.
Leveraging our extensive experience in helping first time buyers in Leicester and home movers in Leicester, it’s worth noting that most mortgage lenders typically request a minimum of three months’ worth of bank statements from applicants.
Given this requirement, it presents an ideal opportunity to shift your focus from the past to the future. You now have a dedicated period of at least three months to enhance your financial situation. One prudent step to consider is taking a hiatus from frequent visits to local bookmakers or online gambling platforms.
This break can have a positive impact not only on your financial health but also on your overall well-being. Additionally, we recommend exploring strategies to save money during this timeframe.
Simple adjustments, such as choosing to cook at home instead of dining out, trimming unnecessary expenses, and discontinuing redundant subscriptions, can free up extra funds to ensure that your bills are promptly settled.
In essence, the key here is to exercise sound financial judgment and engage in proactive planning well in advance of your intended financial endeavours. The farther you distance yourself from periods of financial instability and debt, the greater your prospects will be when engaging with a lender.
No matter if you’re a first time buyer in Leicester, currently in the midst of moving home in Leicester, or are self employed in Leicester, maintaining a strong handle on your financial situation is consistently important.
If you happen to be facing challenges related to a less-than-ideal credit history and are uncertain about the way forward, we strongly recommend seeking specialised mortgage guidance in Leicester by reaching out to us today.
Our dedicated team is fully committed to offering the most comprehensive advice to help you throughout your mortgage journey. Please don’t hesitate to get in touch; we are here to help you in effectively navigating your financial path.
Saving for a mortgage deposit can pose challenges in the current economic climate. As trusted mortgage brokers in Leicester, we empathise with the concerns of first time buyers in Leicester who often find the homebuying process daunting.
To embark on a successful mortgage journey, it’s essential to prioritise a good credit score, accumulate an adequate deposit, and demonstrate affordability through supporting documentation.
In this article, we will delve into effective strategies for saving towards your mortgage deposit and provide valuable insights on key factors to consider before applying for a mortgage.
Our aim is to empower you with the knowledge and guidance necessary to make informed decisions and navigate the process with confidence.
With our expertise and experience, we’re committed to supporting you on your path to homeownership in Leicester. Let’s explore the strategies and considerations that will help you achieve your goal of owning a home.
In order to save effectively for your mortgage deposit, it’s crucial to carefully evaluate your monthly disposable income. Take a close look at your average monthly expenses and determine how much you can realistically set aside for savings.
This evaluation will provide you with a clear understanding of the amount you can save each month. While the minimum deposit requirement is typically 5% of the property’s value, it’s common for first time buyers in Leicester to aim for higher deposits, reaching up to 20% of the property’s value.
Saving a larger deposit offers several benefits. Firstly, it leads to lower monthly mortgage payments, making homeownership more affordable. Additionally, if you have bad credit, lenders may require a deposit of around 15-20% to mitigate risk.
It’s important to note that a larger deposit reduces the loan-to-value (LTV) ratio, which improves your standing with lenders. It demonstrates your ability to save and showcases your financial reliability as a mortgage applicant.
In addition to the deposit, it’s essential to consider other costs associated with obtaining a mortgage, including arrangement fees, solicitor fees, property survey fees, and potential expenses related to working with a mortgage broker in Leicester.
By accounting for these expenses, you’ll gain a comprehensive understanding of the financial commitment involved in the homebuying process.
With effective planning and careful budgeting, you can save for your mortgage deposit with confidence, bringing you closer to your goal of achieving homeownership in Leicester.
There are various government-led schemes designed to help with boosting your mortgage deposit or saving for one. It’s worth exploring your eligibility for these schemes to determine if they can support your homeownership goals.
One popular option is the Shared Ownership scheme, which enables you to secure a mortgage for a portion of a property, thereby reducing the initial deposit required.
Through this scheme, you can obtain a mortgage for 10-75% of the property’s value, making it a valuable tool for first time buyers embarking on their mortgage journey in Leicester.
In addition, there are several other schemes available, including the Lifetime ISA, first homes scheme, and mortgage guaranteed scheme.
If you’re interested in learning more about these schemes or would like to discuss your options, don’t hesitate to contact us or book a free mortgage appointment online with one of our knowledgeable mortgage advisors in Leicester.
For further information, you can also visit the government’s OwnYourHome website, which provides detailed insights into the available schemes and the benefits they offer.
Receiving a gifted deposit can be a significant advantage when it comes to boosting your mortgage deposit and enhancing your chances of buying a home.
A gifted deposit refers to a generous contribution towards your mortgage made by a family member or friend. It’s important to understand that a gifted deposit is not a loan but a genuine gift, meaning it does not need to be repaid in the future.
This type of financial support can have a profound impact on your ability to achieve your homeownership goals. It increases the funds available for your deposit, making it easier to meet the required amount and potentially opening doors to more favourable mortgage terms.
When receiving a gifted deposit, it’s crucial to ensure that all parties involved, including the lender, are fully informed about the source of the deposit and the nature of the gift. This ensures compliance with any legal and regulatory requirements associated with the mortgage application process.
If you have the opportunity to receive a gifted deposit, it can be a valuable asset in your journey towards homeownership, helping you turn your dreams into reality.
Taking the time to review your monthly bills and subscriptions is essential to identify potential areas where you can save money and allocate more towards your mortgage deposit savings.
Begin by conducting an audit of your expenses, carefully examining each bill and subscription to evaluate if there are opportunities for cost reduction. Compare prices, explore different providers, and negotiate better deals to ensure you are getting the best value for your money.
Finding cheaper alternatives and securing more affordable options can significantly increase your monthly savings, allowing you to contribute more towards your mortgage deposit.
Additionally, it is beneficial to assess your current memberships. Consider if there are more cost-effective alternatives available or if you can reduce the number of memberships you maintain.
By cutting back on unnecessary subscriptions and memberships, you can free up additional funds to be directed towards your mortgage deposit.
Remember, every amount you save brings you closer to achieving your homeownership goals. By taking proactive steps to identify areas to save, you can make meaningful progress towards accumulating the necessary funds for your deposit.
Buying a property with a friend or partner is a popular choice among many first time buyers in Leicester. This option allows you to combine your savings, effectively increasing your purchasing power and widening your options in the housing market.
It is important to approach joint ownership with caution, particularly when it comes to financial matters. It’s important to be aware that your friend or partner’s credit history can have an impact on your own eligibility for a mortgage.
If your potential co-owner has a poor credit history, such as defaults or late payments, it could affect your joint mortgage application. Lenders will assess both applicants’ creditworthiness and may take the lower credit score into consideration when determining the terms of the mortgage.
Fortunately, there are specific mortgage products designed to accommodate joint ownership scenarios. These mortgages are tailored to meet the needs of individuals purchasing a property with a friend or partner.
In this type of mortgage, both parties share joint ownership of the entire mortgage and have equal rights over the property. In the unfortunate event that one party passes away during the mortgage term, the full ownership of the home will automatically transfer to the surviving owner.
Lenders consider both parties as a single entity, meaning that any actions related to the property, such as selling or remortgaging, require mutual agreement and cooperation from both joint owners.
It’s crucial to maintain open and transparent communication with your co-owner to discuss and make decisions regarding the property. By working together, you can ensure a harmonious and effective process when it comes to potential future transactions involving the property.
Remember, mutual understanding and cooperation are key in successfully managing joint ownership and navigating any future changes or decisions related to the property.
This type of mortgage enables multiple owners to have distinct shares in the property, with the flexibility to determine the proportion of ownership based on individual contributions or agreements. The ownership shares do not need to be equal and can be tailored to each owner’s specific circumstances.
As individual shareholders, you have the freedom to sell or transfer your shares in the property in the future. This means you have the option to sell your share to another party or even gift it to someone else, within the parameters of any applicable legal agreements or restrictions.
It’s essential to seek guidance from legal professionals who specialise in property law to ensure a smooth and legally compliant process when transferring or selling your shares. They can provide the necessary advice and assistance to protect your interests and uphold your rights as a shareholder.
By following the proper procedures and seeking expert advice, you can navigate the process of transferring or selling your shares in the property with confidence and ensure a fair and transparent transaction.
If you have a less-than-perfect credit history, it’s likely that lenders will require a larger deposit from you. Typically, they may ask for a deposit ranging from 10% to 15% of the property’s value.
While saving a larger deposit can be challenging, it’s an important step to meet the requirements set by lenders. It’s important, however, to note that there are ways to improve your credit score and enhance your borrowing prospects.
Here are some tips to work towards improving your creditworthiness:
It is crucial to be registered on the electoral roll as it serves as proof of your current address and demonstrates your reliability to lenders.
To improve your creditworthiness, it is important to double-check the accuracy of your personal information, including your name and address, across various platforms.
Ensure that your information is correctly spelled and consistent not only on the electoral roll but also on your banking records, store cards, billing addresses, and other relevant accounts.
By maintaining consistency in your address information across different platforms and verifying its accuracy, you present a unified and dependable profile to lenders. This reinforces your trustworthiness as a borrower and instils confidence in your financial responsibility.
Regularly reviewing and updating your personal information, particularly your address, ensures that your records are current and aligned. Taking a proactive approach in this regard helps maintain a robust credit file and further enhances your credibility with lenders.
Using your credit card to its maximum limit and carrying a balance without paying it off each month can have adverse effects on your credit score. To maintain a strong credit profile, it’s important to use your credit card responsibly by paying off the balance in full every month.
Paying off your credit card balance in full showcases your responsible credit management and financial discipline. This demonstrates to lenders that you can effectively handle credit without accumulating excessive debt.
Consistently paying off your credit card balance establishes a positive credit history, which is essential for future credit applications and favourable loan and mortgage terms. It highlights your reliability as a borrower who can manage credit obligations effectively.
To maintain a healthy credit score and enhance your overall creditworthiness, it is advisable to use your credit card wisely. Keep your balances low and aim to pay them off in full each month.
By practicing responsible credit card usage, you contribute to a positive credit score and improve your financial standing.
It is of utmost importance to prioritise meeting payment deadlines and ensuring that you have sufficient funds in your account when credit card payments are due. Consistently adhering to these practices has a significant positive impact on your credit rating.
By consistently making timely payments, you demonstrate financial responsibility and reliability to lenders. This helps in building a positive credit history, which plays a crucial role in determining your creditworthiness.
To ensure timely payments, consider setting up automatic payments or reminders to help you stay organised. This will help you avoid late payments, which can have adverse effects on your credit rating.
Consistency in meeting payment deadlines and maintaining a strong payment record showcases your ability to manage your financial obligations effectively. This responsible behaviour not only enhances your credit rating but also increases your chances of securing favourable terms on future credit applications.
By prioritising payment punctuality and diligently managing your finances, you establish a solid foundation for your financial well-being and pave the way for a positive credit rating.
It is important to consider closing any credit accounts that are no longer in use or that you have no intention of using. Keeping unused accounts open can potentially have a negative impact on your credit file.
Having an old address linked to an account can create discrepancies and affect your credit score. Therefore, it is advisable to update your address information and ensure that all accounts reflect your current and accurate details.
This advice also extends to store accounts. If you have store accounts that you no longer utilise, it is beneficial to close them. By doing so, you can streamline your credit profile and prevent any potential negative impact on your credit score.
Taking proactive steps to close unused accounts and update your address information helps maintain a clean and accurate credit file. This contributes to a healthier credit profile and enhances your overall creditworthiness.
Being financially linked to someone with a poor credit history can have adverse effects on your own credit score. This situation commonly occurs in cases of divorce or separation, where both individuals remain financially connected and their actions can mutually impact each other’s creditworthiness.
When you are financially linked to someone with bad credit, their financial behaviour, such as missed payments or defaults, can potentially harm your creditworthiness. This can make it more challenging for you to obtain credit or secure favourable terms on loans and mortgages.
To safeguard your credit score, it is crucial to sever any financial connections with individuals who have bad credit. This may involve closing joint accounts, removing your name from shared loans, or taking other necessary steps to ensure your financial independence.
By proactively disentangling yourself from these connections, you can protect your own credit score and maintain a strong financial position. It is recommended to seek guidance from a financial advisor or credit expert who can provide personalised advice based on your specific circumstances.
If you’re embarking on the journey of saving for a mortgage and need expert advice in Leicester, our team at Leicestermoneyman is ready to help you.
We understand that starting the mortgage process can feel overwhelming, but we’re dedicated to providing a helping hand and easing your concerns. With over 20 years of industry experience, our knowledgeable team has the expertise to guide you through the process.
To begin, you can easily book your free mortgage consultation with one of our experienced mortgage advisors in Leicester. Whether you prefer to book online or give us a call, we’ll ensure that you receive personalised guidance tailored to your specific needs and circumstances.
At Leicestermoneyman, our goal is to help you navigate the complexities of the mortgage journey and make informed decisions. Contact us today to arrange your free mortgage appointment and take the first step towards achieving your homeownership goals in Leicester.
Whether you’re a first time buyer in Leicester or looking to remortgage in Leicester, choosing the right property survey is very important.
Our team of experienced mortgage advisors in Leicester are here to help you navigate this process and select the best survey option for your needs.
When you apply for a mortgage, the mortgage lender will conduct a property valuation to assess its value and evaluate the associated risk. There are two main types of valuations: physical and automated.
Physical valuations involve a surveyor visiting the property to assess its condition, which is particularly beneficial if the property has undergone renovations or has specific features that need closer examination.
On the other hand, automated valuations rely on an online database to compare the property to similar ones in the area. While automated valuations are faster, they may not always provide the same level of accuracy as physical valuations.
It’s worth noting that some mortgage lenders may offer a free valuation, although this can vary.
Mortgage valuations are generally the least expensive option as they provide a basic assessment and don’t delve into extensive property details like other types of surveys, which may identify potential concerns or issues.
If you’re considering purchasing a property, it’s highly recommended to obtain a homebuyer report to ensure its safety and overall quality.
During the inspection, a thorough examination of each room in the property will be conducted to identify any potential issues that may require further investigation or immediate attention, such as dampness, mold, or problems with the ceilings.
The homebuyer report will also assess the property’s compliance with current UK property regulations and highlight any legal matters that should be addressed prior to finalising the purchase.
It’s important to note that homebuyer reports offer more comprehensive insights compared to basic mortgage valuations, which is why they come at a higher cost.
Some mortgage lenders may provide the option to include a homebuyer report for an additional fee, while you can also choose to obtain an independent homebuyer report from a qualified and accredited surveyor.
It’s worth mentioning that a homebuyer report may not be suitable for certain types of properties, such as listed buildings, older properties, properties that have undergone extensive modifications, or those in need of significant modernisation.
Please be aware that a homebuyer report typically does not include a market valuation, but this service may be available for an additional fee if required.
A building survey is the most comprehensive and detailed property report available, suitable for all types of properties and particularly beneficial for older ones. It provides a thorough assessment of the property’s condition, identifying necessary repairs and potential upgrades.
During the building survey, you will receive information regarding any legal issues, areas of concern, possible defects, and expert advice on how to address these issues. The report may also include a repair timeline, comments on energy efficiency, and details on the construction of the property.
Furthermore, the building survey encompasses a comprehensive visual inspection of broader aspects such as the roof space, ground floors, and services. Due to the extensive level of detail provided, this type of survey typically comes with a higher cost compared to other surveys.
It’s important to note that your mortgage lender may not automatically offer a building survey, but you can inquire about adding it to your valuation for an additional fee.
Similarly to homebuyer reports, a building survey usually does not include a market valuation, although this service may be available at an additional cost.
Obtaining a building survey ensures a thorough understanding of the property’s condition and any potential issues, allowing you to make informed decisions regarding necessary repairs or upgrades.
During the process of a homebuyer report or building survey, certain issues may be identified that require additional investigation and specialised reports.
There are several types of specialist surveys and reports that can be conducted, depending on the specific concerns raised. These include damp and timber reports, roof inspections, drainage assessments, gas and electric evaluations, asbestos inspections, and central heating assessments, among others.
If any of these issues are flagged during your property inspection, we can help you in finding a local specialist who can conduct the necessary investigations and provide detailed reports on the specific areas of concern.
It’s important to address these issues promptly to ensure the safety, functionality, and longevity of the property.
Unsecured credit requires careful consideration. We frequently speak with customers seeking specialised mortgage advice in Leicester due to issues like missed payments, low credit scores, CCJs, and defaults.
Even a series of missed payments on a mobile phone contract can result in a default on your credit file, which can complicate future mortgage applications and suggest a lack of payment reliability.
Fortunately, having missed payments or defaults doesn’t necessarily spell the end of your mortgage prospects. While it may require specialised mortgage advice in Leicester to navigate the process, there are still potential options available to you.
While a lower deposit may decrease your chances of approval, having a sufficient deposit size can make a mortgage feasible, even with bad credit. When applying with a specialist mortgage lender, they will inquire about the timing and reasons behind any defaults registered against you.
The further in the past the default occurred, and if there is a valid explanation, such as a significant life event, the higher your chances of achieving mortgage success.
Everyone makes mistakes, and if your default was a genuine and honest error, the mortgage lender may show more understanding and leniency during the application process.
Here is a selection of commonly asked questions about bad credit mortgages along with their corresponding answers. If you don’t find your specific question or situation addressed below, please don’t hesitate to reach out to us.
Our experienced mortgage advice team has dealt with a wide range of complex mortgage scenarios and may have encountered a situation similar to yours before. We are here to help you in any way we can.
Prior to applying for a mortgage, it is important to provide your mortgage advisor in Leicester with an up-to-date copy of your credit report. You can typically obtain this report online for free.
Obtaining your credit report is especially important if you have concerns about your credit history. It helps you assess your financial standing and prevents multiple unsuccessful credit searches, which can negatively impact your credit rating and potentially hinder your mortgage application.
The answer to this question varies based on your specific circumstances. Many customers find themselves puzzled by their credit score and seek assistance in understanding why it may pose an issue.
While some customers may have a favorable deposit and a steady income despite a less-than-ideal credit score, mortgage lenders may still be hesitant to approve their borrowing due to the associated risk.
Mortgage lenders need assurance that you can consistently meet your mortgage payments without the risk of falling into arrears. Repossessing your home is something they aim to avoid whenever possible.
Despite the challenges, options for bad credit mortgages do exist, albeit with higher interest rates.
To navigate this process effectively, it is highly advisable to schedule an appointment with an experienced mortgage broker in Leicester who can guide you through the available options and help you make informed decisions.
Financial difficulties can arise unexpectedly, leaving you struggling to meet your mortgage payments despite previously having no issues. Unfortunately, even temporary setbacks can result in missed payments being recorded on your credit history.
When it comes time to remortgage in Leicester, buy a home as a first time buyer in Leicester, or move to a new property, these credit challenges can present obstacles. Mortgage lenders assess the risk involved and determine whether they can trust you to avoid similar situations in the future.
As experienced providers of transparent and specialised mortgage advice in Leicester, we have helped numerous customers who were previously tied to a mortgage and now face a poor credit history.
If you find yourself in a similar situation, consulting with a fast and friendly mortgage broker in Leicester can greatly benefit your journey toward achieving future mortgage success.
During the mortgage process, customers may encounter various bad credit issues that can lead to significant challenges. These issues include, but are not limited to:
While these circumstances are less than ideal, they don’t necessarily mean the end of the road for you. Although you may face a longer and more arduous process with higher mortgage rates, there are specialist mortgage lenders who can potentially offer assistance.
To improve your chances of mortgage success and gain access to better rates, it’s important to focus on enhancing your credit score. By taking steps to improve your creditworthiness, you can pave the way for a more favorable mortgage outcome.
If you require expert and transparent mortgage advice in Leicester on bad credit mortgages in Leicester, we invite you to book your free mortgage appointment online. Our team of experienced mortgage advisors in Leicester is here to help you.
With over 20 years of mortgage knowledge and expertise, we are dedicated to developing a clear plan of action for your credit score prior to the mortgage process. Our ultimate goal is to help you secure a mortgage of your own.
Take advantage of our experience and schedule your appointment today. We look forward to guiding you towards a successful mortgage journey.
It’s essential to plan your mortgage journey, it’s that first step to take before starting the process. Doing so could give you the upper hand and put you in front of other buyers. Preparing a mortgage agreement in principle should be at the top of your list before you start viewing properties.
It’s always to consider every possibility. In this unfortunate situation, you may have planned a mortgage to the last detail but ended up separating. This will require you to take out a mortgage as the sole applicant with no time to plan.
As an expert Mortgage Broker in Leicester, when you are looking at moving house in Leicester. We do recommend that you start planning your mortgage six months prior.
In some circumstances, the mortgage process can throw many hurdles which is why planning is essential. By preparing for any hurdles you may encounter, you should be able to work out what to do to overcome them.
Having worked in the mortgage industry for over 20 years, we have witnessed a large variety of mortgage problems. Even in the final stages of the mortgage journey, some occurrences can negatively impact the process, however, they can sometimes be solved if you prepare enough, or have a Mortgage Advisor in Leicester by your side.
Below are some common problems we have found customers encounter during their mortgage process:
By preparing six months before starting your mortgage journey, you may be able to avoid some of these problems.
For some first time Buyers in Leicester, saving up for a deposit can be the most difficult part, especially for those who aim to achieve their mortgage goals while currently renting. Will understand that saving for a deposit is a timely goal.
In the circumstance where you are struggling to reach the initial deposit total, you may be able to get financial support from your family through a gifted deposit. This amount gifted can be either the entire amount or a contribution.
Maybe one of the Help to Buy schemes can help give you a small deposit boost. There are many schemes available that are designed for applicants needing support with deposits. These are usually popular with many first time buyers in Leicester as a way to get them on the property ladder. There could be a scheme out there that suits your circumstances.
Credit scores are a huge benefactor when it comes to applying for a mortgage. If you have a poor credit score, this can lower your chances of a lender accepting you for a mortgage.
We recommend you use Check My File to see your insights into your credit score. By doing this, you will be able to obtain a copy of your credit report which our team will be able to look at free of charge.
On your mortgage application, you must look after your finances. Every lender will carry out a thorough analysis of your bank statement and will look at all your income and outgoings. Gambling transactions are something that will catch Lender’s eye especially if they are frequent and erratic outgoings.
In the fortunate case where you can receive a gifted deposit, make sure to keep that sum of money in the gifter’s account. That way, you will not have a large bank transfer in your account that lenders would question about.
Therefore, it’s wise to keep this gifted deposit inside of your family member’s or friend’s account.
We tend to find some self employed applicants in Leicester, you may find the mortgage journey a little bit different compared to a regular full time employment applicant.
The evidence you will need to provide as self employed will include at least one year of accounts and three months of bank statements to show your income and affordability. In some cases, you may need to provide additional evidence, however, this just depends on the lender.
Through the mortgage journey, you may come across a range of mortgage hurdles that could stall your purchase completely. One of these includes a break in the property chain. A mortgage broker in Leicester like us will be able to help you overcome these hurdles. We are here to support you 7 days a week.
If you have a specialist or complex case, look at getting mortgage advice in Leicester. Our team can provide you with a helping hand through your mortgage journey.
A gifted deposit is either a portion of or the entire amount of deposit you need to put down on a property and obtain a mortgage, given to you purely as a gift (agreed in official documentation) and with an understanding that you will not repay it.
Gifted deposits in Leicester are very useful if you are financially capable of covering the monthly mortgage repayments, but are struggling to save up for the initial deposit as a first time buyer in Leicester.
This can occur perhaps due to a lower income or frequent larger outgoings, such as rental payments and home energy bills. We hear of this a lot when we speak to first time buyers in Leicester.
In receiving a gifted deposit, you may also allow yourself to gain access to much better rates of interest during your mortgage process, especially if that gift is above the minimum 5% deposit requirement.
Generally it will mainly be parents (birth and adopted) and carers who are able to gift you the deposit. This is often discussed online using the terminology “Bank of Mum & Dad”.
Other extended family members may also be able to help out with a gifted deposit. This entirely depends on the mortgage lender that you end up with though, so it is worth speaking to a mortgage advisor in Leicester ahead of time, if that is the case.
We’re often quite surprised at the amount of customers who have no idea their parents are able to help with their mortgage! We also encounter a good portion who feel like they maybe can’t ask their parents for help.
The truth is, the majority of parents out there 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.
Typically speaking, taking out a mortgage may save you more money per month than you would get from renting, as depending on the conditions of your mortgage, you could be paying much less per month.
The deposit that is gifted often comes from inheritance, although parents can sometimes gift it much earlier if they have enough money saved or have released equity from their own home.
The majority of mortgage lenders won’t agree to accept a loan as a means of paying off your deposit. It will be often relate to the lender not being so sure if you have the ability to afford paying both back at the same time.
Whilst there aren’t limits to the amount that can be gifted to a home buyer, it’s worth remembering that some lenders will want you to have at least 5% from your own savings.
In general, the more you can afford to put down, perhaps combining savings and gift, the better the deals you are going to have access to.
It will usually be first time buyers and people moving house in Leicester who will benefit the most from gifted deposit.
You may also be able to use a gifted deposit to cover the initial 5% deposit for the Help to Buy Equity Loan Scheme, though this will again depend on the mortgage lender.
Your donor will be required 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 may be required.
As an open & honest mortgage broker in Leicester and surrounding areas, we always aim to provide our customers with the highest level of customer service, through a fast and friendly mortgage advice service.
We always rise above for our loyal customers, no matter the mortgage situation they are currently going through. When someone gets in touch with us for mortgage advice in Leicester, we will consider all cases, no matter how complex.
A trusted and experienced mortgage broker in Leicester is available seven days a week, from early on until late. Our advisors will be ready and waiting to offer their support at all times.
Book your free mortgage appointment today with an expert mortgage advisor in Leicester and we’ll see how we are able to help you on your mortgage journey.
Property price inflation has majorly overruled the increases in standard wages over the years. These days, a home buyer may look at the option to purchase a property with a friend or partner in order to be able to afford a property.
It all comes down to looking at affordability. Having two parties within the process, lenders will be calculating two incomes instead of one, which could lead to an increase in the maximum mortgage amount. Obviously, the mortgage will be more affordable between two people because the costs will be split between two people.
You may that many mortgage lenders will let up to four people co-own a property together. With many parties being involved, it can result in some debate with changes in circumstances. Let’s as one borrower decided to stop their contributions to the group mortgage payments, the lender will still go to the rest of the group for payment.
Therefore, it’s important that you are careful with who you buy with. All joint owners still hold a legal right to stay within their home unless a court rules otherwise. Because of this, the person failing to put forward their contribution doesn’t have to leave as they are still a part-owner of the property.
In the case where one of the parties is looking to increase the mortgage at any point in the future, then you need permission from all borrowers to do this. Planning ahead for the future is good practice just in case circumstances change.
Many couples who are married, in civil partnerships or simply cohabiting to go for joint tenancy for a mortgage. If you are looking to buy with a relative or friend, you may look at a Tenancy in Common. In the case that you are wanting to sell or remortgage the property in the future, you will need the consent of the other applicant.
When it comes to a tenancy in common, you will still jointly own the property, however, there is no legal requirement to do so in equal shares. Having this option is helpful if one party is earning a lot more per month than the other. As well as this you can act individually if you are a tenant in common. You can freely sell or give way your share of the property to another person, if you wish to remove yourself from the agreement.
If one of you were to, unfortunately, pass away, the property will be in possession of the other owner on the mortgage. We do recommend taking out life insurance to protect yourself from this in the future. The mortgage would be repaid at that point.
It’s important to know that all mortgage borrowers are jointly and severally responsible for mortgage payments. With this in mind, if one of the parties stops paying, then the other parties involved have to help with the shortfall to avoid the mortgage falling into arrears. This can stop you from getting another mortgage in the future. See it as you not owning 50% of a property but 100% of it jointly.
No one who buys a home with a partner does so with the intention of things not working out. If you are looking to remove a mortgage, it can be very challenging. This is because a mortgage is a big financial commitment so making changes to it later is not always straightforward. Before you can proceed with this, lenders will need to be certain that you can manage the mortgage payments on your own.
Regardless of if you can show that you have managed to maintain mortgage payments since your ex moved out does not always mean that a lender will agree to your request to put the mortgage into your sole name. Lender do prefer two people to pursue in case of arrears occurring.
When it comes to removing someone, they will carry out a brand-new affordability assessment, in the exact way as they would at the point of purchase if the lender declines the request. It’s best that you get in touch with a Mortgage Advisor in Leicester to look at if other lenders would agree to your request to transfer the mortgage into your name.
In the circumstance where you and your partner split up and you leave the family home, you are still responsible for mortgage payments with them. Regardless if you agree with your ex that they will make all the payments it’s still your responsibility. If you are sending your partner money each month, you should keep an eye on your credit report to ensure they are paying the mortgage.
Choosing to default, will impact your score. If you get connected to an old mortgage, then the payments for that will be considered if you subsequently want to buy a new home of your own. That will mean Lenders might not lend you as much as you would like. Buying a home with anyone is a risk, so you need to go into it with your eyes open.
It’s always better to agree on what would happen to the house should things not work while you are all still getting along well! It can be helpful to speak to an expert specialist mortgage advisor in Leicester to look at what your option might be. If you are looking for more information, check out our article ‘divorce & separation mortgage advice.’
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.
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.
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:
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.
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!
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.
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.
It is a common practice nowadays to seek specialist mortgage advice in Leicester when clients have bad credit or not paying off their bills on time.
Something as small as a missed or late payment from your bills may result in a default attached to your credit report. Which may harm your capability to obtain a mortgage because it implies that you cannot keep up with repayments on time.
But that doesn’t mean it’s impossible, having any missed payments or defaults in your credit file may require some additional help from a Mortgage Broker in Leicester like ourselves. This is because most High Street Banks will reject your application for a mortgage, especially if you only have a small deposit.
Your lender will need to know the date the default was registered against you and how long ago it was. The more details are given, the more likely it is that the lender will be able to help you. Especially if it was down to a life-related event such as ill-health, redundancy or separation.
We tend to find that clients often make mistakes in the past, and these financial mistakes can come back to haunt them. We may also be able to help you if you have had historic mortgage arrears or a CCJ (County Court Judgement).
Below are some helpful responses to frequently asked questions about Bad Credit mortgages in Leicester and nearby areas. If you can’t find what you need in our bad credit FAQs, one of our Mortgage Advisors in Leicester will be more than happy to get back to you.
Your advisor will need to see an up-to-date copy of your credit report and show any previous credit problems you had in the past. You can find a copy of your recent credit report online for free.
Before applying for any mortgage, doing multiple credit searches can damage your credit rating. However, it’s still vital that you obtain an up-to-date copy of your credit report.
This all comes down to your circumstances and affordability. Some customers find themselves a little perplexed by their credit reports. It might look bad, they may have had issues, but they have a stable income and enough deposit to reduce a rate and obtain a decent mortgage deal. It makes you wonder if you are in that same position but the lender still won’t let you borrow the amount you’ll like or need. That’s because it all comes down to risk.
After all, your lender needs to be convinced that you afford all your repayments on time without a likelihood of any arrears occurring. In the event of these arrears, the lender may need to repossess the home, which is something that everybody wants to avoid.
There may be a chance for those who are looking to get a mortgage while having bad credit, you just may have to pay higher rates. For more information, it’s best to speak to a Specialist Mortgage Advisor in Leicester, with their help they can hopefully find you a potential mortgage.
One day you may find yourself in financial trouble and no longer able to keep up with the mortgage payments. These circumstances are unfortunate, and whilst it could be a short blip that you can pay back not too long after, the damage is done, and it will be on your credit report as a missed payment.
You may be faced with other credit issues too, and when it comes to getting a Remortgage or a new mortgage after moving home in Leicester, you may find yourself struggling to obtain a new mortgage. As previously stated, this always comes down to risk. Can the lender trust you? Will you be in the same position again?
The good news is, with the help of Specialist Mortgage Advice in Leicester, we have had helped previous customers who have had a mortgage and have since ended up with Bad Credit. If you are in a similar situation, speak to a Mortgage Broker in Leicester like ourselves, we may be able to help you achieve your mortgage goals.
Customers may find themselves in a position to have adverse issues regarding their credit, all of which can impact your affordability for a mortgage. These issues vary from, but are not limited to;
Whilst this is an awful situation to be in, it’s not the end of the world. Your mortgage process may be longer, more challenging, and you may end up on a higher rate, but there are lenders out there, who might have a mortgage deal on their panel, who will accept your mortgage application.
To boost your chances of success and open yourself up to better rates, you need to focus on improving your credit score. We have a handy guide on different ways to improve your credit score, which will hopefully put you in a much better place for obtaining a mortgage in the future.
If you require any Mortgage Advice in Leicester regarding a Bad or Adverse Credit situation. Don’t hesitate to get in touch with a member of our team. Utilising their knowledge working in the industry, working extra hard to try and put you in the best possible position to eventually obtain you a mortgage.
It can be tough saving money for a deposit, particularly if you’re paying rent as well. To help those struggling to get on the property ladder in Leicester, the government introduced various help to buy mortgages.
This article will include the following:
All aimed to help First Time Buyers in Leicester who are struggling to save for a larger deposit to get onto the property ladder.
Help to Buy Equity Loaneligible to remortgage to raise capital for this loan, however, doing so may lead to your mortgage payments increase.
The Shared Ownership scheme allows applicants to purchase a percentage of a property and then pay the rest back on rent.
The percentage of the property that you own usually needs to be between 25-75%, though this can change. The remaining portion is likely to be owned by the housing association.
The way that your payments work is that you will have both your mortgage plus rent outgoings. So, you are paying 100% of the ground rent and service charge on the property.
Following the success of the Help to Buy Equity Loan scheme, this scheme had a similar concept as its predecessor, except you have to work in Armed Forces.
If you fit into the criteria, it could be an excellent option for you. The good news is from 1 January 2023, The Forces Help to Buy Scheme will become an enduring policy, ensuring its availability to all service personnel now and in the future.
The Lifetime ISA can be still beneficial, and it can help you secure a property as a first time buyer in Leicester. Essentially it’s a savings account where the money grows tax-free.
The government will also top up your savings by an extra 25%, so if you meet the £4,000 maximum amount, you will receive a nice £1,000 bonus.
You have to pass specific criteria to gain access to this scheme. All of the details will be on the Government Lifetime ISA page.