How much can I afford?

Is it best to get a fixed or a tracker rate?

How much will a solicitor cost?

Do I need Life insurance?

Do all lenders charge a valuation fee?

What is the Lenders arrangement fee for?

How can I get a lenders decision In Principle?

How much mortgage can I afford with my income?

What risks am I taking if I buy now?

Why will some lenders give me a bigger mortgage than others?

How much should I offer?

Do I have to use the solicitor the Estate Agents recommend?

How much will the stamp duty be?

Can my parents help me out as guarantors?

I’ve been turned down by 2 lenders already, does that mean I can’t get a mortgage?

Want some answers? text 07855 799 807 for a call back or email me

How much mortgage can you get with a £20,000 deposit?

£20,000 takes a lot of saving for a First Time Buyer! You will probably need an 85% loan to value mortgage - the higher the loan to value, the more the monthly pay rate will be.

As a rough indication, most lenders will go to about 4X your income, so on an income of £25,000 a target mortgage of £100,000 is about right..

Any credit cards or loans you have will affect this total, as the monthly payments are anualised, then deducted from your income before the borrowing potential is calculated.

If you are a First Time Buyer AND you are on a probationary period, it should not be a problem - although this will limit you to just a few lenders.

I would suggest you get a Decision In Principle (DIP)- this is a cost free exercise, and involves a pre application credit and ID check. The lender will then indicate the amount they would be prepared to lend you. (this is not a gurantee of a mortgage, but it gives a good indication that a full application is likely to be successful)

A DIP also enables you to be in a strong position when it comes to making an offer – it shows you are serious and have an interested lender.

You might find these blogs useful

http://www.usefulmortgages.co.uk/news/uncategorized/what-is-the-cheapest-mortgage-rate.php

http://www.usefulmortgages.co.uk/news/uncategorized/moving-home-%e2%80%93-my-10-top-tips.php

Enquire

Independent Mortgage Brokers: Directly authorised and regulated by the FSA reg no 438462

Your home is at risk if you do not keep up with repayments on a mortgage or any loan secured against it

One thing is sure, moving home and office is a killer. Having just gone through the process myself I really empathise with my clients who move home!

Top Moving Tips:

DIP it -Get a decision in principle (DIP) from your lender before you put in an offer on a new purchase. If the agents and Vendor know you have the new mortgage in place, you are more likely to get a really low offer accepted.

Get a good deal -It’s a good idea to shop around, rather than just go back to your existing lender. There is quite a bit of competition among lenders at the moment, especially for the low loan to value, high credit scoring clients.

Look forFreebies – Some lenders are offering specials like free valuation or free legals on a purchase.

Computer says NO -Some lenders offer mortgages where the big lenders response is ‘computer says NO’. They offer assessment of risk by humans, and may pass a declined case.

Be misersable!! – f you are smiley and give positive comments as you go round a property 2 things happen 1. The agent will think he can talk up the offer price 2. You will be less likely to put in a really low offer. I know it goes against the grain, but be dead pan, no positive comments. KEEP THEM GUESSING!!

Think about a Lifetime Tracker – They follow the BOE base rate by a set margin for the lifetime of the mortgage. This may mean that you won’t ever need to change your mortgage again. It also means that you will save on remortage costs every 2 or 3 years.

Less Hassle – a broker can do most of the chasing – Agents, vendors, solicitors and insurance arrangements. It can take a lot of pressure off a stressful experience.

The general view of economists and markets is that the first rise will come late in the second half of 2011 but the forecast has been shifting and a token rate rise well before that is a possibility. That view was reinforced by MPC (Monitory policy committee) ‘hawk’ Andrew Sentance saying a rate rise was needed ‘to show we’re on the case’ (25 Nov).

View the full article    http://www.thisismoney.co.uk/interest-rates

My Comment

There is a lot of uncertainty about when and by how much interest rates will rise. An interesting indicator is Mortgage Lender interest rates. Tracker rates have still been coming down, with lenders competing for market leading rates..

More significantly, a major lender has just announced cheaper fixed rates. 2 year fixed rates are now only marginally more expensive than trackers, which must reflect lenders expectations that rates will remain low for some time.

3 year fixed rates are more expensive – so there is clearly more uncertainty after the next 2 years.

More Useful Blogs

This report has been compiled by Ray Boulger, John Charcol’s respected senior technical manager.

“In terms of remortgaging, borrowers with at least 25% equity should be considering a remortgage or product transfer if they are on an SVR in excess of 3%. Anyone with one of the many lenders charging an SVR of between 4.5% and 6% may well find it worthwhile remortgaging, even with only 15% equity, although their options will be very limited if they want an interest only mortgage or have even a minor amount of adverse credit.”

To view the full report: http://www.myintroducer.com/view.asp?ID=6034

My Comment

There are lots of really good products available especially for fixed rate mortgages.  Now is a good time to review and see if there are good alternative products.  A recent remortgage client had to pay a £4,127 penalt to get out of a 5 year fixed rate. Over 2 years however, he will  save £5,688 because his monthly payments reduced by £237 pcm.

Fixes rate mortgages – a good time to consider them?

Source: Martin Gahbauer, Nationwide’s Chief Economist:

“The property market entered 2011 with a whimper rather than a bang, with house prices edging down slightly in January. Prices fell by 0.1% month-on-month, leaving prices 1.1% lower than January 2010.”

My Comment

The market has been slow nationally, but I have been busy with first time buyers and Buy To Let purchases. This reflects that many vendors are willing to accept lower offers, and purchasers feel they are getting a good deal. The outlook for 2011 from most quarters is that property prices are likely to remain low, so if you are selling, aim for April or May to get your property on the market. These are traditionally the best months to sell. There are some good bargains out there ready for investors to snap up.

Getting a good Buy To Let mortgage Deal:

There may be a low starting pay rate for the first 1 or 2 years, but the follow on rate is often around 5% variable.

There are some products with a higher starting rate, but the follow on rate is much LOWER.

Over 5 years these lower follow on rate products are usually much cheaper than the higher follow on rate products.

My comment:

When looking at the best Buy To Let product, decide how long you are likely to need the mortgage. If its 5 years or more check the total cost of the product over the likely term. Don’t just go for the cheapest start rate – it could be a false economy.

• A Low follow on rate could be more cost effective than a low start rate.
• Compare the overall cost of different mortgages over say 5 years before choosing a product

Fancy a Buy 2 Let property – but it needs some refurbishment before its rentable?

Most lenders will only consider a Buy 2 Let if it is immediately habitable.

There are, however, some products that are designed for Buy 2 lets that need light refurbishment. The refurb must be completed in 3 months.

The usual route is to get Bridging Finance – but a Bridge has high set up fees, and rates are typically 1.5% per month.

A standard ‘light refurb’ Buy 2 Let mortgage has much lower fees and standard mortgage monthly rates.

My Comment

. Light Refurbishment Buy 2 Let projects are difficult to fund.

. There are lenders who have mortgages for Buy 2 Let properties that need light refurbishment.

. A mortgage product is nearly always the cheapest way to fund this type of project.

Need more info?