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The Pros and Cons of Using a Mortgage Broker in Leicester

As could likely be predicted, we personally feel like there are some really great reasons why you should use a mortgage broker in Leicester. This isn’t born out of bias, however, as we understand there are pros and cons to both, no matter if you’re a first time buyer in Leicester, looking to remortgage in Leicester, or have another situation.

Regardless of if you’re going via a branch or online, you are still able to go direct to the mortgage lender yourself. Below are all the pros and cons to either of your options.

Pros & Cons

When thinking about going direct to a bank or building society, the first thing that springs to mind is that you won’t be required to pay a broker fee, which in turn would possibly save you money. In the past, another positive that people thought of was “the bank manager knows my finances inside out”, though after credit scoring systems were introduced, this no longer became a factor.

On top of this, some mortgage lenders will have exclusive mortgage products on offer, that can only be obtained by going direct. They offer these as a way of attracting a good spread of business from their consumers and other brokers, turning exclusive products on and off whenever they believe it to be necessary. On the other side of the coin, some products may only be accessible by going to the broker and not by going direct to the lender.

From 2014 onwards, lenders were restricted from selling their mortgages on a non-advised basis to any customers of their services (those with bank accounts, for example). Up until that point, some applicants felt like members of staff who were not qualified for giving advice, were pushing their services on them.

They also felt like they weren’t able to benefit from some of the consumer protection that would normally come with mortgage sales performed by professionally trained mortgage advisors in Leicester.

The changes took a long while for lenders to come to terms with and towards the back end of 2014, it was not uncommon for customers to have to wait a long time to get a mortgage appointment. This is unfortunately still the case today sometimes. When you have had an offer accepted on a house, this is the last thing you need or want!

Because of the issues present with going direct, much like the wait for an appointment, more and more applications were made with mortgage brokers who could freely offer a same day service, something we are able to do ourselves. When you get in touch with us, we get you booked in with a mortgage advisor in Leicester as quick as we can, either on the same day or at your earliest convenience.

Affordability is an important factor too, as the quality of a lenders deal won’t matter if you have no way of affording it. Buying a house is such a large step in people’s lives, that they often would rather get professional and personal advice from a qualified and experienced mortgage advisor in Leicester.

Handling Difficult Cases

Nowadays we find that a lot of mortgage applications aren’t as simple anymore. For whatever reason it may be, there are so many things that can make a case more complicated. Some examples of these are:

  • Mixed source of deposit (savings/gift)
  • Poor credit history
  • Let to Buy (keeping your current house and buying another)
  • Affordability
  • Contract workers/zero hours contracts
  • Self-Employed Income

In the past, mortgage lenders were able to stand head and shoulders above the competition by simply offering a deal that was similar to one offered by another lender, but with slight differences to make it more appealing. Fast forwarding to where we are now and it is all so much more different, with lending criteria being the difference maker between deals and lenders.

An example of this, is that some lenders may lend more than other lenders might have to Self Employed applicants. Some also take a more sympathetic view on previous discrepancies that are showing on your credit report.

Your situation will be unique to you. It may be similar, but it will never be the same as another case. When you explain your position to an experienced mortgage broker, it is highly likely that there will at least be at least something similar that we have encountered before, allowing for a more personalised service. Hopefully, our hard working mortgage advisors will be able to get you a favourable deal with good interest rates.

It’s more than just getting a mortgage though. Even if the application itself is fairly easy, our customers who are first time buyers in Leicester rely on our experience and knowledge for more insight into the mortgage process.

For example, we are able to sit and discuss how much they are going to offer on the property they are buying. From there, our team of mortgage advisors in Leicester can recommend our customers other necessary professional services such as solicitors, whilst also explaining the different types of property survey and protection that is available to them.

Responsive Service

One of the main pros of using a mortgage broker in Leicester, we believe, is that we are a lot more responsive than the mortgage lenders have been known to be. Our team work from early until late, all throughout the week (including out of hours), dedicated to our customers and ensuring the process is as speedy and stress-free as it can be.

Something that does get overlooked from time to time when looking at why customers may prefer to use a broker, is that everyone nowadays everyone has such a busy schedule. You might need a mortgage but don’t have the required time to sort it out. In these cases, your mortgage advisor can take the weight off your shoulders and work through it for you.

Professional applicants especially will see the benefits of this service, as they have clients of their own that they charge out their services to and often don’t have the time to work through it themselves. The customers we deal with regularly appreciate the benefits of having an expert on their side.

Perhaps in the future we’ll see lenders wanting to limit their links to brokers and wanting to take their business back. If this does happen, we don’t see it being likely that they will hire more staff in their branch networks. The future of all industry seems to be based around technology and the mortgage market may very well be heading this way too.

That may work for customers who are more than happy to do business with a “robo-advisor”, especially for cases that are easy and don’t require a thorough analysis. For the majority of people, however, there’s an element of “realness”, that “human touch” that can’t be obtained by going this route, and can only be found by speaking to a real mortgage advisor in Leicester.

To find out more information on our service or to present any mortgage queries that you have, please Contact Us and we’ll book you in for an appointment with a mortgage advisor in Leicester as soon as we can.

Buying a New House in Leicester

Mortgage Advice in Leicester

Obtaining a home as a first time buyer in Leicester will be one of the biggest purchases you will ever make. It’s best to take your time when buying a home, as you need to be sure that the property you are looking at ticks all the boxes for you. Therefore, you must ask important questions that will help you make a decision.

If you are unsure of what to ask the seller, have a look at our shortlist of questions you could ask:

1. How much interest has been shown in the house?

In many cases, a new home that has been recently added to the property market can spark a lot more interest and become high in demand. Therefore, it’s best to act quickly to secure the plot. To have an insight into the amount of attraction there has been towards the house, you could ask the seller how many people have already viewed the property to see the amount of ‘competitors’ you may have.

2. Is there a chain?

A property chain is when you are waiting on the occupant that is in the property you are buying off to move out to their new property which they have to wait for. When it comes to a chain, it can mean that it will take longer to move due to the property already being occupied, however, if there isn’t a chain, this could mean you will be able to move in quicker.

From a seller’s point of view, a first time buyer in Leicester or someone who is not in a chain could be seen as more desirable as this could lead to a quicker sale. From a buyers point of view, these points can be a huge advantage and something to mention during your ‘negotiations’. 

3. Is there anything extra included in the sale?

In some cases, new homes can come with ‘extras’ that could persuade you to buy the house. Sometimes this is intentional and other times, the seller may simply wish to leave their older furniture behind. If you’re looking at buying an older home, you may find that there are unwanted items included, such as outdated furniture or well-used appliances.

It’s wise to check just to clarify, are things like cookers, fridges, and carpets, for example, could be included in the sale (or offered at an additional price). Make sure you clear as you may be left with unwanted items that you then need to remove and dispose of.

4. What are your new neighbours like?

Your experience with neighbours can make or break owning your own home. You risk losing enjoyment if you are stressed all the time with the people next door. Gaining an understanding of the neighbours can give you a good indication of what living there will be like, saving you that stress down the line.

5. What is the local area like?

Your personal criteria for the local area when hunting for a home, could be that you need a shop nearby or somewhere that’s only a short commute to work

Asking what the local area is like could mean you wanting to know about any leisure spots nearby e.g bars, gyms and restaurants or wanting to know what are the schools like if you are thinking of having a family in the future.

It’s best to do your research about the local area before committing yourself to any purchase. As people’s opinions are subjective so it’s best to make your own judgement.

6. Are there any running costs?

Associated costs such as heating, council tax, water (newer homes tend to have a water meter) are something to ask as it is part of running a home that you need to know. Many people are more aware of the running costs involved in owning a home or if not, you could ask a family member or friend.

7. What is the garden like?

Even though the British weather isn’t always sunny, some people still like spending time in the garden. Therefore, you may want to ask if the garden gets as much natural light and whether it’s south-facing etc.

8. Will any home improvements be needed?

When you move into your new home, you will often find that you will want to decorate it to your tastes. Home improvements can be essential to some older properties due to many needing ‘fixes’ or repairs. You may want to make improvements on the property such as insulation, efficiency, or garden work.

9. Are there any remedial fixes?

Buying an older property can come with repairs on some items. The seller can fix these issues if you have requested it to happen before the sale goes through or, in some cases, the seller may reduce the price. There can be some minor repairs if you are looking at a new build because of settlement or simple faults you identify after you moved in.

To make you aware of the remedial fixes that would be needed on a property, you may want to look into the different types of property surveys. Our mortgage advisors in Leicester can help recommend the most suitable survey for your property. Generally speaking if it’s a new build property, you will only need a basic valuation as you would hope with the property being new, that it is structurally sound. Whereas, if you are purchasing an older property, you may want to look into a home buyer’s report or full structural survey which should outline any defects with the property such as damp, subsidence etc.

When you are buying a new home whether it’s a new build or older property, make sure you ask the questions you need to know about the house. Asking the right questions, may be the difference between you buying the property or not.  

MoneymanTV | Types of Property Survey

The Different Types of Mortgages Explained in Leicester

The different types of Mortgages in Leicester we provide

When you start your mortgage process in Leicester, you will come to realise that there are lots of different options available to budding homeowners and existing homeowners alike.

Whether you’re a First-Time Buyer looking for your first home, are Home Movers looking for your next home or are looking to Remortgage in Leicester, there are many different routes you could take.

This article will cover a list, alongside related videos, of the most popular types of mortgages available on the market to customers. If you have any further questions mortgage-related, then please do not hesitate to contact us and speak to one of our dedicated Mortgage Advisors in Leicester.

What is a Fixed-Rate Mortgage?

A fixed-rate mortgage means that your mortgage payments will remain as they have been for a set period. You can set the length of the fixed term yourself, with common options typically being 2, 3, or 5 years or longer.

No matter what happens to inflation, interest rates, or the economy, you can rest assured that your mortgage payment, usually your biggest outgoing, will not change at any point during your term.

Fixed Rate Mortgage Explained | moneymanTV

What is a Tracker Mortgage?

A tracker mortgage means that your interest rate will follow on with the Bank of England’s base rate. This means that the lender that you are with does not set the rate themselves.

You will be paying a percentage above the base rate of the Bank of England. To provide an example of this; if the base rate is 1% and you are tracking at 1% above base rate, that means you will be paying a scale of 2%.

Tracker Mortgage Explained | moneymanTV

What is a Repayment Mortgage?

When you take out a repayment mortgage, you are paying capital and interest together. So as long as you keep your payments going for the full length of the mortgage term, the mortgage balance is guaranteed to be paid off at the end, with the property becoming yours.

It is the most risk-free way for your capital to be paid back to the lender, in the early years it is mainly the interest that you are paying, and your balance will go down at a slower rate, especially if you have taken out a 25, 30, or 35-year term.

This situation will switch up in the last ten years or so of your mortgage, where your payments are paying off more capital than interest, and the balance will come down at a much quicker rate.

Repayment Mortgage Explained | moneymanTV

What is an Interest Only Mortgage?

While many Buy to Lets in Leicester get set up on an interest-only basis, it is much more challenging to get a residential property on that same basis.

It is a lot less likely for lenders to offer an interest-only product nowadays. However, there are certain circumstances where this may be a viable option.

These include downsizing when you get older or having other potential investments that you will use to pay back the capital. Lenders are being a lot more stricter when it comes to offering these products now, and the loan to values are a lot lower than they once were.

Interest Only Mortgage Explained | moneymanTV

What is an Offset Mortgage?

With an offset mortgage, the lender will set you up a savings account alongside the mortgage account you have with them.

This works in a way where, let’s say you have a mortgage balance of £100,000 and £20,000 gets deposited into your savings account, you would only pay interest on the difference, so in this case it would be £80,000. It can be a very efficient way of managing your money, especially if you pay higher rates of tax.

Offset Mortgage Explained | moneymanTV

Should I overpay my mortgage in Leicester

Mortgage Broker in Leicester

You could be a First-Time Buyer in Leicester looking to get onto the property ladder, a Home Mover in Manchester or a homeowner at the end of your term, looking to Remortgage for Home Improvements. In any of these cases, overpaying, even by a small amount, can be incredibly useful when it comes to the amount on the interest you pay back over your mortgage term. The earlier you begin to overpay on your mortgage, the better the effects it will have.

Some homeowners prefer not to do this, some cannot afford to. Quite often though, it will come down to life just getting in the way. Regardless of the circumstances, overpaying is definitely a good habit to get into when you take out a mortgage, but in reality, there’s always something else we’d rather buy, as opposed to making an extra payment on our monthly mortgage.

Put the Plan into Action | Mortgage Advice in Leicester

Part of the dilemma here is remembering to make those extra payments. It’s unlikely to cross your mind too often, except perhaps when your mortgage only has a few years left to run.

So, if you can see something of yourself in the above and would like to be making those extra payments so that, perhaps you can retire a year or two early, then what should you do?

It’s highly recommended setting up a standing order payable to your lender each month. Set up the standing order to go out on the same day as your regular mortgage payment. E.g. your mortgage payment is, say £500pm and is collected on the 1st of the month. You can afford to pay an extra £75pm, so set up a standing order for £75pm to go out of your bank also on the 1st

The reason for the above is that very quickly you will start to “feel” that your mortgage is £575pm and you will get used to that within a matter of months.

You are Still in Control |Mortgage Advisor in Leicester

The big advantage of setting up a standing order to a direct debit, is you (the payer) are completely in control, unlike a direct debit where this is the receiver.

Therefore, if you find yourself a little tight with money for one month. You can easily log in to your online banking and pause the standing order so that it would cancel any future payments from going out until reactivated.

Up until the point of stopping the payments, at least you have benefited from the additional payments made until that point, and as mentioned above, this does not stop you from reactivating your standing order in the future when you are more financially comfortable.

Some mortgages will even let you make reduced payments or take a Mortgage Payment Holiday in Leicester if you have been overpaying for a while. Before choosing a payment break though it’s essential to check with your lender that you are eligible to do so to avoid a bad mark on your credit report.

Whether a First-Time Buyer or going for a Remortgage in Leicester, overpaying your mortgage is a great habit to get into. You don’t need to go hell for leather at it unless you feel so obliged but even shaving a year or two off will be very welcome when you near the end of the term.

Remortgage Advice in Leicester

Reason To Seek Remortgage Advice in Leicester

Is your current mortgage deal approaching its end? Are you in need to borrow some extra money? If so, then it could be the appropriate time for you to Remortgage.

Many people, due to unfavourable economic situations, can find themselves in hot waters when it comes to making mortgage payments. If you are in the situation, you should ideally speak to your current lender and see if they have better alternatives to offer you. Remortgaging is perhaps one solution to the problem. However, the remortgaging process can sometimes be complicated and require Mortgage Advice in Leicester.

We frequently observe that customers leave searching for a new deal too late and end up falling straight to their existing lender’s standard variable rate. This is why you should always be aware of when your current deal is about to expire. Unquestionably, a lender’s rate will be a lot higher than your current rate thereby increasing your monthly payments by a significant number. So remember, there is nothing bad to think ahead and speak to Remortgage Advisor in Leicester.

Should I look elsewhere for a remortgage or stay with my lender? 

It is always the best approach to look around for other deals first before committing to an existing lender. Sticking with your existing lender may speed up the process, as you have an established relationship and they have your details on file, but there could be better deals with lower rates out there. So, go straight to the same lender just because you think it’s easier. Lenders never reward loyalty, they could offer better deals and rates to their new customers than to customers who have been with them for the past five years. 

On the contrary, many people look for online options where they can apply for remortgage online without speaking to an advisor or lender. Such a scenario is called an execution-only mortgage. Yes it can be easy to perform everything online, however, the consumer protection that an individual would have gotten by seeking advice will be no longer available. 

Lenders love their customers doing everything online as applicants often end up messing things up and picking out the wrong product, which can result in the borrower being on a higher rate than what they could’ve been on had they taken Remortgage Advice in Leicester earlier.

Remortgage Advice in Leicester for home improvements

Do you feel like your home is due to some upgrades and improvements? Home improvements or minor house upgrades are great ways to freshen up your home and increase your home value. 

Did you know that you could remortgage for home improvements? It can be a significant investment, as improvements such as extensions or loft conversions can add significant value to your property. People who are not even looking to increase their property value, because they have found their “dream home”, will also borrow for a home makeover. This could either be cosmetic alterations or some structural work. 

If you need to borrow a significant amount of money, your lender will reserve the right to ask you for estimates of the work you intend to carry out. You do not necessarily have to use the contractor that provided the estimate to do the actual work. 

Capital Raising Remortgage Advice in Leicester 

For any legal reason, you can raise capital on your property when you remortgage. This case is specific for large consumer purchases, gifts to help out family members, purchase a Buy to Let property, or for debt consolidation. 

Remember that you will be paying interest on a remortgage for an extensive period after you take one out so you need to ensure that you are borrowing for the right reasons and that you will be able to meet monthly payments during the whole mortgage term. 

Debt Consolidation Remortgage Advice in Leicester 

Most people associate remortgaging with securing a better interest rate for their monthly repayments or releasing funds for home improvements, but it is also possible to remortgage to consolidate debt. 

Adding unsecured debt to your mortgage may result in paying higher interest overall. It is because a mortgage term is usually much longer than the duration of a personal loan (this isn’t always the case). 

You will need to realise that you are acquiring an unsecured debt and securing your home. This will not fit in easily with everyone as you are lying under the risk of repossession if you failed to afford your mortgage payments down the line. 

You will need to notice that if you have 0% credit cards, the interest rates that apply to the debts that you are considering rolling onto your mortgage will start attracting interest ultimately. 

It’s important to know that you need to speak to a qualified mortgage advisor prior to securing any debts against your home.

Remortgage options

Before deciding to consolidate debts, you should consider all of your options beforehand. The best way to go about it is to seek Remortgage Advice in Leicester from a remortgage advisor. They will evaluate all of your options and then recommend you with the best route to go down. They might even recommend that you do not take a debt consolidation remortgage; it is the option that will benefit you the most. 

Often, when you consolidate debts into your mortgage it would lead to a reduction in your monthly outgoings. This would ultimately result in many customers reducing their payments by hundreds of pounds. 

Be vigilant enough to evaluate if this is the right option for you and then decide to speak to a Remortgage Advisor in Leicester today.  We are all up to assist you with all of your remortgage needs. 

Mortgage Payment Holidays | Mortgage Advice in Leicester

Mortgage Payment Holiday Advice in Leicester

At the start of the Coronavirus pandemic, the Government promised that all borrowers would be allowed a three-month mortgage payment holiday if they needed it. Most lenders followed the Government’s guidelines and did their best to help out their borrowers during these hard few months. 

We feel that it is best, to sum up, what mortgage payment holidays are, what lenders are doing, and who can deliver you with help and advice through these next few months. 

What is a Mortgage Payment Holiday?

Mortgage payment holidays are an agreement entered into with your bank, building society or mortgage lender to defer your monthly mortgage payments for a set period. In this case, 3-months.

It does not mean you never have to pay the amount back, but the interest you defer gets added back onto the loan amount, while your capital balance will not decrease. In other words, your mortgage amount will increase slightly, and you will continue to attract interest on the whole amount.

When you are ready to continue the payments, this could mean that either your monthly payments recalculated at a slightly higher level or your mortgage term increases to some extent.

Most lenders will probably prefer not to extend your mortgage term as this could take you past their standard retirement ages, but the detail on this will follow in due course.

Dependent on your mortgage deal, you may be able to pay off a lump sum later in the year to bring your mortgage back to where it would have been.

Mortgage Payment Holidays are available both for those with residential or Buy-to-let Mortgages in Leicester, which means landlords also have assistance if rental payments are affected.

What is the Government Proposal?

The full proposal is in detail below:

  • Mortgage lenders will offer an automatic 3-month mortgage payment holiday for customers impacted, directly or indirectly, by COVID-19.
  • The mortgage payment holiday will apply to customers who are up to date on their payments, not in arrears, and wanting to self-certify that COVID-19 impacts them.
  • Meaning that lenders will not complete an income and expenditure assessment, or evaluation of alternate payment options as ordinarily required under MCOB.
  • This proposal will allow lenders to be more responsive to customer needs and offer forbearance in a simple way to customers in an environment where COVID-19 also impacts the operation of collections teams made.
  • Customers will be made aware that interest will accrue in the holiday period, and they will need to make up deferred payments in the future.
  • Customers who wish to undertake a full assessment of their ability to pay or financial difficulty may still do so.

How do I apply?

We would recommend speaking to your Mortgage Advisor in Leicester. They will asses your financial situation first before looking to defer your payments as your situation may not yet be pressing.

Approaching a Mortgage Broker in Leicester like us will allow you to explore all of your current mortgage options and could make things feel a lot less stressful.

For a customer, up to date with payments, not in arrears, and impacted by COVID-19:

What does this mean for my Credit Score?

In some cases, a mortgage payment holiday can harm your credit score, but most lenders have now said that for matters linked to the virus, they will ensure that this is not the case.

You must ask this question to your lender directly and record the response, including the date and the name of the person you are speaking to avoid confusion later. Different lenders are doing different things.

Will I still be able to Remortgage or take a Product Transfer with my lender?

At first, everything seemed like it would remain the same, and you would still be able to make changes to your mortgages as usual. Leading to a change over in the last couple of days, and lenders have been asking borrowers to avoid making changes while you are within a mortgage holiday period. So, at the moment, they are not allowing mortgages and product transfers.

Borrowers nearing the end of their existing product could get compelled to move on to the higher lenders variable rate, which means that borrowers who act too early could find themselves on a mortgage payment holiday that accrues interest on a costly variable rate.

We would highly recommend speaking to your Mortgage Advisor in Leicester, and they will determine the best course of action based on your personal and financial situation. If possible, arranging your mortgage transfer first then asking for the holiday would seem to be the most sensible way forward.

My Mortgage got Offered Will my Lender Withdraw the Offer?

At the moment, no Lenders have withdrawn mortgage offers; in fact, some are extending offers past the standard six-month expiration date. 

Should I Pull out of my Purchase?

You should not pull out of your purchase unless, for example, you are worried about losing your job as a result of Coronavirus. We are advising everyone to proceed as usual for now and “wait and see” – you are not committed to completing your purchase until contracts get exchanged.

What “Other Options” are available?

In some cases, lenders can offer you a temporary switch to interest-only to reduce your monthly payments but not to add any further to the loan amount by still servicing the interest payments each month.

It may not be necessary to convert all your mortgage to interest only, and it may be that putting part of the mortgage on this basis could give you the breathing space you need.

People with savings may find that remortgaging onto an offset basis could give them a helping boost they were looking for, and they will be cutting down on their monthly payments while keeping hold of their savings.

For example, someone with a £400,000 loan and £100,000 in savings would only pay interest on £300,000. Meaning their monthly mortgage payments will massively be reduced.

For others, a straight remortgage to another lender, calculating the cost of any early repayment charges, may well be enough to ease the burden or simply extending the term of your mortgage.

If you still have any other questions on mortgage payment holidays or just want general Mortgage Advice in Leicester, give us a call today. We want to help you and your mortgage journey through these tough few months ahead. Speak to an experienced Mortgage Advisor in Leicester today.

Help to Buy Equity Loan Remortgage

The Government launched Help to Buy equity loans to mortgage applicants back in 2013. The property market got prolonged to recover from the credit crunch. This was one of many schemes designed to give it a boost. The interest-free period of the equity loan was for 5 years. So many of these are now due for repayment to avoid interest accumulating.

If your 5-year period is ending soon or has already completed. You should consider speaking to a Mortgage Broker in Leicester like us. We may be able to reduce your monthly payments or re-organise your finances.

How does the scheme work?

The scheme works by the Government typically loaning the applicant up to 20% of the property’s value. There is no interest payable for 5 years. If the property increases in value. Then the amount you owe to the Government increases also, so in that instance. The zero % could be quite misleading to some people.

The buyer is only required to put down a 5% deposit, and that is what made the scheme so famous.

From our experience

We have seen of Help to Buy; many borrowers are unsure of what they signed up to when they bought the house. The reasons being the scheme was not explained adequately to them. Or they got a little carried away with the excitement of purchasing a home. Either way, it comes as a nasty shock when the letter arrives. Asking what action you intend to take to repay the loan.

In any case, it’s a loan, not a gift, and the Government owns a percentage share in the borrower’s home. The borrower has 25 years to repay the loan unless they sell the house beforehand. At the end of the interest-free period, the interest gets charged at 1.75%. In year 6 should the borrower not repay the loan at that time. The interest rate then goes up each year after that.

When the interest repayments kick in, some customers may struggle to keep up their payments. Most customers look to try and remortgage at some point.

Things to be aware of

Not all lenders will accept remortgaging applications from Help to Buy customers. There are restrictions on the maximum loan to value when raising the capital to repay an equity loan. Some Lenders can consider going up to 95% though. The significant advantage of repaying the equity loan in full is that any future increase in the value of the property will be 100% to the homeowner’s benefit and won’t be shared with the Government any longer.

If a Lender cannot get found who will lend you the full amount to repay the Government loan when you come to remortgage, then another option could be “staircase”. In any case, this is when you gradually pay off the loan in instalments over some time, thus reducing the percentage of your home the Government owns. You can only use the staircase in multiples of 10%.

Mortgage Advice in Leicester

A Guide to Offset Mortgages in Leicester

Offset mortgages are by no means as accessible as they were in the 1990s. The demand has dropped because people aren’t as good at saving as they used to be. However, they are a fantastic option for customers who can put something aside each month. They are also ideal if you think you may receive a lump sum soon.

How does offset mortgage work?

In terms of how they work, when you take out an offset mortgage, the Lender gives you a Savings Account at the same time. The Savings Account gets linked to your mortgage. While the Savings Account does not attract any interest, the money in their “offsets” against your mortgage balance. E.g. if you owe £100,000 on your mortgage and you have £18,000 in your Savings Account then you only pay interest on £82,000.

Pros and cons of offset mortgages

Offset Mortgages are very flexible arrangements. You can put as much money in there as you wish until the mortgage is completely “offset”. Any money you put in there is instantly accessible, so it’s an ideal place for your “rainy day” emergency fund.

Because the Savings Account saves interest on your mortgage rather than attracting attention, there is no tax to pay on anything you put in there. In any case, this is particularly attractive to Higher Rate Taxpayers – they love Offsets!

In terms of negative factors, you do pay for a few of these flexible features. Offset mortgages tend to have slightly higher interest rates and fees than other mortgages. Therefore, if you are not going to use the adjustable features, you’ll be better off with a more standard mortgage.

Putting down a deposit

If you are due a lump sum for some reason such as a possible future inheritance, then an Offset Saver can be an excellent place to deposit the money until you decide what to do with it. The same applies if you get annual or quarterly bonuses in your job that you are not relying upon.

Consumers who like Offset Mortgages tend to stick with them and are less likely to remortgage as other customers. They can be hard to get your head around so you should consider all options available when you speak to a Mortgage Advisor in Leicester. Your Advisor will be able to show you the impact of how an Offset Mortgage can save you money over the course of the full term.

Overpaying your offset mortgage

Many people plan to overpay their mortgages when they first take them out but never actually get around to it. Sometimes this is because they are nervous about paying too much off their mortgage, leaving behind little for future capital requirements. Again, Offsets are an excellent solution for this type of borrower as you can drawback your money at any time, but every day that your cash is in the Savings Account it’s working for you.

How to Improve your Credit Score in Leicester today

Way to improve your credit score | moneymanTV

Mortgage Advice in Leicester

Without a doubt, we recommend that everyone should spend time to manage to boost their credit score. The higher your credit score, the more chance you have of your mortgage application getting accepted. No one is guaranteed to get approved, and different Lenders have their internal scoring systems.

Following we advise everybody like a First Time Buyer in Leicester, to not worry if you fall short with one Lender. Contact us and Speak to one of our Mortgage Advisors in Leicester their job is to match you to the correct Lender that suits your circumstances, end of the day we both want the same outcome to get you the best deal available.

Different reference agencies

We recommend going to ether Experian and Equifax. It’s a good idea to use multiple agencies to get an average of the numbers for your credit score. Just using one agency might hold incorrect data. Checking with several agencies will help you identify any such discrepancies.

There are some excellent practices listed below regarding things you can be doing to improve your credit rating:

Avoid unnecessary credit searches:

Firstly multiple credit searches can harm your score. Be careful when using price comparison websites, which are significant culprits of credit searching on individuals. However you know you want to apply for a mortgage soon, it is wise to avoid using it for any other credit. While having some credit and paying it back is a good thing for your score, in the long run. In conclusion, Lenders do not like to see you increasing your borrowings just before making a mortgage application.

Are you on the Voter’s Roll?

Being on the electoral roll adds many points to your score. It indicates stability and Lenders like that. Ensure your name spelled correctly and that it’s your current address, not an old one. However, if you are not registered, it’s easy to do so online.

Don’t Run Close To Your Maximum Limit

If you max out your card each month, that will reduce your score. Using a credit card and paying off the balance in full each month is preferable. Not to mention, it is indicating that you are good at managing your money. Worst of all would be exceeding an agreed card limit or overdraft. Lenders want to know that you take your finances seriously.

Check your address history Is keyed correctly

Quite often, it can appear that you are living in two places at the same time on your credit report. Maybe you had forgotten to tell one of your credit providers that you have moved to a new house. Check all addresses have been spelled correctly. If you have lived in a flat, this can be tricky as the flat/apartment number can get formatted in different ways.

Close Down Any Unused Credit Accounts

You should contact the providers of store/credit cards you no longer use and get the account closed. In the short term, this can harm your score briefly as the credit reference can’t tell if it’s you closing the account down or the provider. However don’t worry, it’s one step back to take two forward. Another good thing to do to reduce your chance of falling victim for fraud should you not notice you have lost a card you don’t use regularly.

Remove Financial Links to others

If you have a family member or ex-partner connected to you, then this could be affecting your score. You won’t be able to get the financial association removed if the account is still live, in any case. To remove one of these links, you should contact the credit reference agencies and make a request.

Furthermore, many consumers had felt that credit scoring is an ‘unfair way’ of Lenders assessing applications. Lenders feel differently. It is much cheaper for them to operate this way.

Send an up to date copy of your credit report to your Mortgage Advisor upfront, and you will increase your chances of being accepted the first time. The more your Advisor knows about your finances, the better. There are still some smaller Lenders out there that do not credit score. These Lenders do it the old-fashioned manual way, they will always have specific rules about the number of defaults and CCJ’s they will allow.

Mortgage Advice in Leicester

Latest Government Guidelines on the Property Market

Getting the property market functioning again in Leicester

The relaxation of lockdown has begun, although things are going to be a very different place for a long time. During the lockdown, we know for a fact that mortgage applications got held up. However, things are taking a positive turn, and we see some fantastic mortgage/ remortgage deals. Interest rates have never been this low in over 20 years.

Whether you are a First Time Buyer in Leicester who was in the process of starting a mortgage or a current homeowner hallway through Moving Home in Leicester, now is the perfect time to bring you guys up to speed.

The Government has announced new guidelines in regards to the property market to get it functioning again as we gradually come out of lockdown. This is positive news.

Property Market

To summarise this week’s position:

  1. Surveyors are now permitted to go back to work. Fantastic news, as this has been a real sticking point for the past couple of months.
  2. Viewing properties is now permitted, but estate agents are getting told to encourage virtual viewings online where possible.
  3. Homeowners are permitted to prepare their properties for sale.
  4. Removal companies can start work again.
  5. Tradespeople can operate in homes again – good news if you are planning home improvements.

We would like to point out that all of the above relaxations are subject to additional specific health and safety guidelines and social distancing.

Mortgage Market

In terms of mortgages at the moment:

  1. Surveyors have an enormous backlog of work to catch up on, so things will return to normal very slowly.
  2. The availability of high loan to value mortgages. It’s still limited compared to pre-Lockdown. Some Lenders have increased their maximum loan to values this week though, which is positive.
  3. Interest rates are meager, so many customers who can get a mortgage are locking in on 5-year deals.
  4. Low loan to value mortgages still readily available – lenders are trying to lend where possible.
  5. Rules on lending to furloughed workers have tightened, and some Lenders are pulling back on debt consolidation also.

We understand that things take time, we’re a long way before everything can get back to ‘normal.’ But rest assured you’re in a great opportunity if you are currently looking for a mortgage/ remortgage deal. Our Mortgage Advisors in Leicester can help search thousands of deals tailored to your financial circumstances.

Mortgage Broker in Leicester

Here at Leicestermoneyman, we have a vast array lender on the panel that has different deals that we can access for you. During this time we are seeing more customers interested in Remortgage for Home Improvements in Leicester.

They realise that it is easy to sort out and may increase your monthly mortgage payments by £100 – £200, this mainly applies to homeowners wanting to start a family or expand their current one.

Once you got in touch and got a few details from you, you will get put through to one of our fantastic Mortgage Advisors in Leicester, who will provide nothing but help and support throughout the whole of the mortgage progress. Our goal is to find you an excellent mortgage deal!

Mortgage Advice in Leicester

Leicestermoneyman.com & Leicestermoneyman are trading styles of UK Moneyman Limited, which is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited is authorised and regulated by the Financial Conduct Authority.
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