Are Mortgage Rates Going Up?
Mortgage Rates & Mortgage Advice in Manchester
Those with a mortgage know the stress of taking one out, and how your process can be severely impacted by the economy. For example, if mortgage rates fly through the roof where the economy is not performing, unfortunately, you could expect your monthly payments to go up, or in some cases, you may not be able to afford to take out that product now.
Rates have fluctuated massively over the years, and they likely always will. If you are looking to get a mortgage in Manchester, there is neither a best nor worst time to start your process! It entirely depends on the market, and your application can take a month to prepare, therefore, you should get your process started right away. Our mortgage advisors in Manchester will try to help you find a mortgage product with a competitive rate of interest; the best that they can at the time of your application.
What are mortgage rates?
Mortgage rates and interest rates are exactly the same. These are the rates that your lender will charge you on your mortgage repayments.
If you manage to seal a low interest rate on your mortgage deal, you could be paying a lot less each month on your mortgage repayments in Manchester.
How are mortgage rates determined?
There are a number of factors that can affect what mortgage rates you are able to access. Most of these factors can be influenced by your personal and financial situation. Examples can include your credit score or your total deposit amount. The lower your lender sees you as a risk, the better rates you may have access to.
At the end of the day though, it is down to the economy. For example, if you are on a tracker mortgage, your interest rate will be determined by the Bank of England’s base rate. The Bank of England’s interest rate is also dependent on the performance of the economy and the position of the mortgage market. This could mean that the base rate fluctuates, sometimes resulting in higher mortgage repayments. This is something that you cannot control, however, sometimes it can work in your favour if the base rate goes down.
On the other hand, if you were on a fixed-rate mortgage, your interest rate would not change over your fixed term. Your fixed term usually lasts between 3-5 years, although you can take out products over a longer term if you find a deal that allows you to do so. You may find that when you remortgage in Manchester, your rate may have increased, this will be the best that you are able to get in your personal and financial situation.
Are my mortgage rates in Manchester going to be affected by inflation?
Whilst inflation is on the rise, so will the cost of living. During this incline, you will find that your mortgage rate may slightly rise. Again, this can depend on the type of mortgage product that you are able to take out.
The government try to keep a target for the Bank of England base rate and plans for it to remain at a steady rate, however, when the economy is performing badly, it can slightly rise to balance it out. When the economy is performing badly and those with a fixed-rate mortgage have a deal that is coming to an end, unfortunately, they could end up on a higher rate. As a mortgage broker in Manchester, we would recommend that you speak with an expert like ourselves during times like these. We will try to find you the best rate available with a product most suited to your personal and financial situation.
Fixed-Rate Mortgages vs Tracker Mortgages
These two types of mortgages are usually the most popular among homeowners. Both tend to offer favourable interest rates, however, they both work very differently.
As you know, fixed-rate mortgages keep the same interest rate throughout your fixed mortgage term. Whether this is 3, 5, or 10 years, this percentage will remain the same. This means that your monthly repayments will be exactly the same, making it easier to manage your finances. We can’t give a precise base rate percentage that you would expect a fixed mortgage to have because they are always changing and co-dependent on the economy.
Most people look to “fix” in for 3 or 5 years, it is rare that we see people go as high as 10. Say that you manage to secure a fixed-mortgage product with a 4% rate of interest for 5 years and during the 5 years, the interest rates shoot up to 5% or 6%, you will be happy knowing that your mortgage repayments are going to remain the same as your rate is fixed.
A tracker mortgage uses the Bank of England’s base rate to calculate your interest rate. This could mean that your repayments fluctuate month on month. Although this sounds like you are worse off, this also means that your repayments may reduce for some months.
Your mortgage in Manchester – It’s up to you!
It is all down to your preference and what you are able to access. Remember that lenders will look at your affordability (such as your deposit) and your credit rating to determine what deals you can access. The best advice that we can give is to speak with a mortgage advisor in Manchester. They will be able to try and find a deal perfect for your personal and financial situation. They will also recommend the best option for you.
Sometimes it may not be plausible for you to access a fixed-rate tracker or a mortgage, and you may need to explore other options such as interest-only or variable rates. There are many different types of mortgage available to you and your property in Manchester, not just these two.
Speaking with a professional mortgage advisor in Manchester
If you want to speak with experts with over 20 years of industry experience, we are here to help! Our remortgage advisors in Manchester would love to help you through your mortgage journey and help you find that perfect mortgage product.
We are knowledgeable and experienced; our team know how to pick out the perfect product for you. The key is to make sure that you find a product for you that is tailored to your personal and financial situation!
You can book a free mortgage appointment online today and speak with a mortgage advisor in Manchester. We have appointments available 7 days a week, during the morning, afternoon or late at night. Choose an appointment that best suits you!
We are looking forward to hearing from you!
What is a Mortgage illustration in Manchester?
Mortgage Illustration Manchester
A mortgage illustration is a document that you will receive during the mortgage process. You will be given one once your mortgage advisor in Manchester has found you a suitable mortgage product for your circumstances.
A mortgage illustration outlines every detail of a mortgage deal. Your mortgage advisor in Manchester will provide the illustration alongside the recommended mortgage product.
If you’re satisfied with the product and have read over the illustration to make sure that you know all about the mortgage deal, the mortgage application process can start.
At Manchestermoneyman, you will get a mortgage illustration following your free mortgage appointment. You can simply book a free appointment online and speak with a mortgage advisor in Manchester; we are available 7 days a week, so pick a date and time that best suits you.
For more information, watch the MoneymanTV video below or visit the channel for more tips and explanations.
What is included in a mortgage illustration?
The mortgage illustration you receive will cover the main product details, costs of taking out the product, monthly repayments, legal fees and sometimes valuation fees.
Main Details
“Main details” include information such as the length of your fixed contract, who you are taking out the product with and the interest rate.
Costs of Taking Out a Product
Most, if not all mortgage products come with arrangement fees. The cost of the arrangement fee (if applicable) will be stated in your mortgage illustration.
Monthly Repayments
Your monthly mortgage payments are determined by your total mortgage amount, interest rate, and fixed term length. The amount that you will be paying per month will be shown in your mortgage illustration.
Legal Fees
Legal fees include the services of a solicitor. As a mortgage broker in Manchester, we will talk you through these costs before passing you over to them.
Valuation Fees
In most cases, a property survey must be carried out on the property before obtaining a mortgage. If you need a property survey, the costs should be specified in your mortgage illustration. These costs can vary depending on the property value, property type and type of survey.
Do I have to agree to your mortgage recommendation?
The product that is presented to you is only a recommendation, therefore you are under no obligation to take it out. However, you must know that your mortgage advisor in Manchester will have carefully selected this product for you and would have tried to find a deal specifically for your personal and financial situation.
Unfortunately, if you choose not to continue with us, you will lose out on the deal.
Does a mortgage illustration guarantee me a mortgage in Manchester?
We cannot guarantee any applicant a mortgage, unfortunately. A mortgage illustration is provided after your free mortgage appointment, therefore, you have not yet submitted any documentation verifying your income, deposit source, and affordability.
Is a mortgage illustration the same as an agreement in principle?
An agreement in principle (AIP) is not the same as a mortgage illustration. While a mortgage illustration outlines the details of the recommended mortgage prior to application, an AIP confirms that the lender is willing to offer to you in principle that you can provide evidential documents to support your affordability.
An AIP can be used to demonstrate your readiness and commitment to purchase a property from the seller.
Book your free mortgage appointment in Manchester
We have mortgage advisors in Manchester readily available to discuss your mortgage options. Whether you are a first time buyer in Manchester, moving home in Manchester or a landlord looking for a buy to let property, we will be more than happy to help you start your mortgage journey.
Remortgaging in Manchester When Your House Value Has Increased
Remortgage Advice in Manchester
Buying a property is a huge financial investment, in fact, it will likely be the biggest investment of your life. Whether the property is going to be your new home or a buy to let for others to live in, you would hope that over time, the value of it would increase.
A property is not only the largest financial asset you possess, but it also provides a roof over your and your family’s head. This property may also be passed on down through generations to come, or the sale of the property could help family members invest in their own property.
Typically, house prices are always on the rise and match inflation, however, there may be times were they slightly dip due to the economy. If you are a property owner and housing prices soar, it is the perfect time to remortgage, sometimes earlier than you normally would too.
When housing prices rise, usually the best interest rates are available. So, to make sure that you are on the best rate available to you, you should look at your remortgage options and consider taking up a new deal whilst the opportunity is there.
What is a loan to value and why do people remortgage for a better one?
Loan to value, abbreviated to LTV, is the ratio of the mortgage to property value. When searching for mortgage products, LTV will be represented as a percentage. For example, if you are purchasing a property in Manchester worth approximately £250,000 and you have a 10% deposit (£25,000), you will need to take out a 90% LTV mortgage.
Deals within the mortgage market are broken down into tiers/brackets. Usually, the lowest tier is around 60% and the highest is 95%. You will find that not every lender offers 95% LTV mortgages on their panel, for example, specialist lenders may require at least a 10% deposit (90% LTV mortgage). Although your personal and financial situation could affect the type of mortgage that you are able to take out, typically, the lower your LTV mortgage is, the more favourable mortgage deals you should have access to.
In the future, say your £250,000 property has increased in value to £270,000 and your initial £250,000 mortgage balance has come down to £225,000, your new loan to value is 83%. As your LTV decreases, you should be able to access better mortgage rates.
The reason why lower LTV mortgages have a more competitive rate of interest is that you are less of a risk to the lender.
The Different Types of Remortgage in Manchester
Despite most not knowing, there are two different types of remortgage, one being a simple remortgage, and the other being a product transfer.
Beginning with the latter, a product transfer is when you take out a new mortgage product with the same lender and just switch deals. This is ideal if you prefer to use the same lender regardless of the rate included.
If you would rather remortgage in Manchester, you would be taking out a new mortgage product with a different lender. shopping around for different deals with other lenders often opens you to competitive mortgage rates.
As a mortgage broker in Manchester, we will be able to help you through your remortgage and help you find a suitable product to switch to that is tailored to your personal and financial situation.
How do I find out the value of my property in Manchester?
Just like when you originally bought the property, your property will be valuated again during your remortgage. You will not need to take out a property survey such as a homebuyer’s report or full structural survey.
A mortgage valuation will establish the true value of the property. Your lender will have them carried out in one of two ways; using an Automated Valuation Model (AVM) or through a physical inspection. An AVM is also known as a desktop valuation, as somebody is not sent out to inspect the property, they look at their databases to cross-reference similar properties in the area to try and determine the value. AVMs will unfortunately miss these factors. If you would prefer a physical valuation, speak with your mortgage advisor in Manchester so that they can mention your preferred valuation method to your lender. A physical inspection is self-explanatory; someone will come out to the property and valuate it in person.
It is all a game of risk to the lenders. They need to make sure that they are lending against the true value of the property, otherwise, they would be lending more than they need to.
Remortgage in Manchester to Release Equity When Your Home Value Has Increased
Having equity within your property is essentially what lowers your LTV, and as you know, having a lower LTV means that you can potentially access better remortgage rates. Despite this being the case, some property owners may still want to release equity through a remortgage in Manchester to use the funds for another purchase.
Releasing equity from your property does mean that your monthly payments could increase. This is because you are taking out equity from your property which increases your LTV. Depending on your financial situation and how far into your mortgage term you are, you may or may not be able to remortgage in Manchester to release equity.
If you choose to invest your released equity into home improvements, it will likely increase the price of your home. As a mortgage broker in Manchester, we have seen customers invest in garden improvements, loft conversions and kitchen extensions and it increases their property value. Some people will invest in their homes to increase the property’s value, but most will invest in their homes to improve their day-to-day life. For example, if your family is growing and you need more space, you could release equity from your home during your remortgage and invest in a loft conversion.
A property is a huge financial asset, it is important to know the positives and benefits of releasing equity. One of our remortgage advisors in Manchester will be more than happy to help you with your remortgage if you need advice.
Can I remortgage early if the value of my home has increased?
The answer to this question entirely depends on how far into your mortgage term you are. Remortgaging early may result in you having to face an early repayment charge (ERC). This is because you are breaking your initial contract term. We will say that you should only remortgage early if you are certain that it is the best thing to do for your financial situation.
In some cases, remortgaging early when your home value has increased can allow you to access a better rate of interest, and paying the ERC could potentially save you money further down the line. An example of when it was a good time to remortgage early was during the COVID-19 global pandemic. This was because the Bank of England base rate dropped and remortgaging at this time could’ve secured a better rate. Yes, you would’ve received an ERC, however, in the long run, you may end up saving some money on your new rate.
This is a niche example from an odd time, but it does demonstrate that sometimes it can be beneficial to pay the ERC by remortgaging early to save money. We would recommend speaking with one of our expert remortgage advisors in Manchester before remortgaging early, just in case you are on the best deal available. We will be open and honest with you at all times and only recommend the best solution for you and your personal and financial situation.
How to Save For a Mortgage in Manchester
Saving for anything these days can prove difficult, never mind a mortgage deposit!
As a mortgage broker in Manchester, we often see that first time buyers find the homebuying process daunting, which is understandable as you will need to make sure that your credit score is good enough, you have a big enough deposit for your mortgage, have sufficient evidence to support your affordability.
Within this article, we are going to take a look at saving for your mortgage deposit and what you need to consider before taking out a mortgage.
Work Out How Much You Need to Save For Your Mortgage in Manchester
Before you can start saving for a mortgage deposit, you need to work out your monthly disposable income. Start with working out your average monthly outgoings and expenditures so that you can calculate and estimate how much you can allocate to your deposit savings. This will give you a realistic view of how much you need to save each month.
Usually, the minimum deposit amount that you will need to put down is 5% of the property’s value. We have seen that some first time buyers in Manchester try to save even more for their mortgage deposit, sometimes up to 20%. The larger the deposit that you put down is, the lower your monthly mortgage payments will be. If you have bad credit, you may need to provide around 15%-20%.
As mentioned before, if you manage to save a bigger deposit, you could end up paying lower monthly mortgage payments. Essentially, this is because you have a lower loan to value (LTV) mortgage. Lenders are always thinking about risk, remember that a mortgage is borrowed money, the more that you borrow, the more interest you must pay back. If you also demonstrate that can save for your deposit you are also appearing as a more reliable applicant.
You will also need to account for the other costs of taking out a mortgage, such as arrangement, solicitor and property survey fees. If you use a mortgage broker in Manchester, you may also want to consider the costs that come with this too.
Are there any schemes available?
There is a wide variety of government-led schemes available that can help boost your mortgage deposit or help you save for one. It may be worth checking to see whether you are eligible for any of these schemes.
One of the more popular schemes is the Shared Ownership scheme where you are able to take a mortgage out on a percentage of a property, hence reducing your initial deposit. You can take out a mortgage on 10%-75% of the with the help of this scheme and it could help you in starting your first time buyer mortgage journey in Manchester.
There are many more schemes available, such as the Lifetime ISA, first homes scheme and the mortgage guaranteed scheme. If you are interested in any of these schemes or want to learn more, don’t hesitate to contact us or book a free mortgage appointment online with one of our mortgage advisors in Manchester. You can also find out more through the government OwnYourHome website.
Help From Elsewhere
If you are lucky enough to receive one, gifted deposits can significantly boost your mortgage deposit.
A gifted deposit is a contribution towards your mortgage gifted to you by a family member or friend. Strictly, this is not a loan it is a gift and must not be repaid in the future.
Review Your Outgoings
You should conduct an audit of your current bills and subscriptions that you out every month and see whether is anywhere that you can save money. You also may be able to find cheaper alternatives by looking elsewhere.
We would take a look at memberships too to see whether there are cheaper alternatives anywhere else. The more money that you manage to save each month, is more towards your mortgage deposit.
Have you considered buying a property with a friend or partner?
Buying with a friend or partner is often the way that we see most first time buyers in Manchester go. It is a popular option because your savings double.
You will have to be careful when it comes to creating financial links with other people because if they have bad credit, it could affect you too. If the person has a default, for example, it could negatively affect their ability to get a mortgage.
There are different types of mortgages designed for those looking to buy a property with their friend or partner, these include:
Joint Tenants
This type of mortgage involves both parties owning the whole mortgage and having equal ownership over the property. If one party passes away during the mortgage term, the full ownership of the home will be carried over to the remaining owner.
Lenders will consider you as one unit, so you will both have to come to an agreement if you want to sell or remortgage the property.
Tenants in Common
This type of mortgage involves multiple owners who have particular shares in the property. The shares in the property that are owned do not need to be equal too.
In the future, since the lender sees you as two separate shareholders in the property, you may be able to sell or give away these shares.
Saving For a Deposit if You Have Bad Credit in Manchester
If you have bad credit, you may need to save more for your deposit. Lenders will often ask for a 10%-15% deposit if you have bad credit, therefore, you may need to spend longer saving up, unfortunately.
You could also try and improve your credit score. Look at some of these tips to see how you can improve your credit score.
Register on the Voter’s Roll
Make sure that you are registered on the voter’s roll so that your lender can see that all of your addresses line up. It will also show your lender that you are reliable.
Double-check that everything is spelt correctly and that this is the same address that you use for your banking, store cards, billing addresses etc.
Try to Keep Within Your Maximum Limit
Maxing out your credit card and failing to pay it off each month can reflect badly on your credit score. It can be best to use a credit card and pay off the balance in full each month.
Meet Payment Deadlines
Leading on from credit cards, make sure that you are meeting your deadlines and have enough in your account when payments are due to go out. The more consistent that you are with this, the better the impact these practices will have on your credit rating.
Close Down Any Unused Credit Accounts
If you have a credit account that you do not use and do not intend to use, you should close them down. They may be doing more harm than good to your credit file.
If an old address is linked to one of these accounts, it can cause a negative impact on your credit score. This applies to store accounts too, make sure that they are closed down if you are not using them.
Detach Yourself From Any Financial Links to Others
Being financially connected to someone with bad credit can negatively impact your credit score. Usually, we see that this is more common following a divorce/separation where the ex-couple are still connected and they are both negatively affecting each other.
Our Expert Mortgage Advisors in Manchester
If you are planning on saving for a mortgage, and you need mortgage advice in Manchester, feel free to reach out to our team at Manchestermoneyman.
We know that starting your mortgage journey can be difficult and it all gets a bit too much sometimes – that’s why we want to offer a helping hand. We have over 20 years of experience in the industry and would love to help you begin your process.
Book online or give us a call to arrange your free mortgage consultation with a mortgage advisor in Manchester.
What Credit Score Do I Need For a Mortgage in Manchester?
When it comes to applying for any sort of finance, you will be asked to provide an up-to-date credit report. A credit report is essentially a summary of your finances and how you manage your money. It will be summarised by a score out of 1000 – your credit score.
As a mortgage broker in Manchester, we see different credit scores every day; some averaging low, some averaging high. Depending on an applicant’s financial situation, credit scores can differ from person to person. In a room of ten people, it would be very unlikely to find two people with the exact same credit score.
Credit scores range from 0-1000. Sites such as Experian, Equifax and TransUnion will give you a general guide as to what is classed as a poor, fair, good, very good and excellent credit score. These are based on averages over a period of time however, therefore, one lender’s impression of a “good” credit score could be completely different to another.
Getting a mortgage with a high credit score in Manchester
Reliability is the key to getting a mortgage, and having a good credit score can massively help in showing that you are reliable and someone who manages their finances sensibly.
Despite appearing as a reliable applicant, you should know that having an excellent credit score will never guarantee you a mortgage. As a mortgage broker in Manchester, we have seen that some lenders offer products that can only be accessed to customers with a credit score greater than 900.
We would recommend speaking with a professional mortgage advisor in Manchester like us before applying for these high-end products. If you do not match the product and you get declined, you could negatively impact your credit score.
Getting a mortgage with a low credit score in Manchester
If you have a low credit score, you still may be able to take out a mortgage. Yes, you could be limited to specialist deals that come with high-interest rates, however, at least you are still may be able to take out a mortgage!
Remember that everyone’s situation is different and that it is also down to people’s personal circumstances too. So one applicant with low credit may get a mortgage whilst another applicant with a similar credit score may not due to their complex personal situation.
Young applicant with low credit score
If you are a younger mortgage applicant with a low credit score, you may still be able to find success in your journey. As a first time buyer in Manchester, you may simply not have built up a sufficient credit score yet. Most of the time, this isn’t a problem, even more so if you are using a government-led scheme such as the Help to Buy Equity Loan or Shared Ownership.
If a first time buyer has low credit, it does not necessarily mean that they are bad with their money they just probably haven’t had the chance to increase it. If there is a record of missed payments and defaults, this will harm the chances of getting a mortgage.
Some lenders may only want buyers with good credit, no matter whether they are a first time buyer or not, it depends on the lender. Before applying to lots of different deals, it can be best to first get mortgage advice in Manchester and get the answer to all of your questions.
Mortgage with a CCJ or Default in Manchester
If you have missed your loan repayments on anything, for a particular length of time, a creditor may issue you a default notice. A default can severely impact your credit score, and even more so if you already have a low score. If your score declines to “poor”, you may be refused a mortgage altogether and may struggle to take out any loans in the near future.
You can pay back a default straight away, but it will still have already impacted your credit score. If you don’t pay it straight away, you will likely be issued with a County Court Judgement. This is the last resort for creditors; first trying to chase the debt and if this doesn’t work then work on an agreement to pay the debt back over time.
Having a CCJ on your credit file is very unappealing. Lenders may be completely put off if they see one in your name. Not to mention that they will also cause damage to your credit score. You could even find it difficult to get a new credit card or open a bank account.
CCJs remain on your credit file for 6 years, even if you settle the amount owed. You can protest a CCJ if you feel that it shouldn’t have been issued, however, you will need to have sufficient evidence to fight your claim.
You can “satisfy” your CCJ by paying it off. It will still appear on your file, although it will say “satisfied” next to the payment. Lenders will be able to see that your debt has been repaid in full. They will also be able to see when the CCJ was originally issued and how long it took you to pay it off.
Typically, the longer a CCJ has been on your file, the more likely you are to get a mortgage. If the CCJ has only been on your record for a year, you’ll be lucky to get your application moving.
This all again depends on the circumstance and the mortgage lender’s criteria. We would always recommend speaking with a mortgage broker in Manchester prior to submitting a mortgage application with a CCJ in your name.
Remortgage with bad credit in Manchester
If you already own property and were looking to remortgage your process should be straightforward enough. But, if you have bad credit and are trying to remortgage, you may slightly struggle depending on your situation.
Even though it is your own home, when you remortgage, you are taking out another mortgage product. When you take out a new product, you still have to undergo affordability assessments and credit score checks, therefore, if you have bad credit, you may struggle to remortgage. You may have to accept the fact that you are going to fall onto your lender’s standard variable rate of interest (SVR).
Speak to a specialist mortgage advisor in Manchester prior to remortgaging with bad credit. An expert can answer all of your remortgage questions and see whether you could qualify for any specialist deals.
How does a low credit score impact interest rates?
If you have a lower credit score, you may find it more difficult to access the lower rates of interest. The lower rate products usually come with a “very good”-“excellent” credit score requirement.
As mentioned earlier, you still may be able to access these better rates of interest if you are a first time buyer. This is because you may not have had the chance to increase your credit score yet.
On the other hand, if you have adverse credit, such as a default or CCJ, you will likely be incurring higher interest rates.
Usually, you are able to put down a higher deposit to gain a better rate of interest, however, if you have bad credit, you may already be asked to put down a higher deposit to show your reliability. In this scenario, you will still likely be on a higher rate.
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When it comes to buying a property, you can go down one of two routes: you can either buy it upfront or take out a mortgage to pay off the property over time.
Both routes will be costly, but of course, you’d expect that when buying a house! Undoubtedly, paying upfront will cost you a lot more money at the time of purchase, however, getting a mortgage will cost you more money in the long run.
It’s likely that you’re going to have to pay the price that’s on the tag when purchasing with cash, whereas a mortgage will allow you to take out a loan and pay it back over a long period of time.
Why should I buy with cash if I can?
If you can afford it, buying a property upfront is a great investment. It doesn’t matter whether you’re planning to live in the property or use it as a buy to let in Manchester, getting yourself on the property ladder can put you in a great financial position in years to come.
Reliability
In the majority of situations, you’ll have the upper hand over someone who’s taking out a mortgage if you’re buying with cash. One of these reasons is down to your reliability.
From the viewpoint of a seller, if a cash buyer approaches you and makes an offer, it’s hard to say no. One reason behind this is that it would be a quick sale. There is no chance of your buyer getting caught up in the property chain as they have the money there and then.
‘Getting stuck in the property chain’ is when a property is being sold and the buyer cannot move in yet as they are waiting for their home to be sold. As you can imagine, this chain can go on and on.
Also, a cash buyer will not have to pass any affordability checks, as they already have everything in place. They can proceed right away!
Easy and fast process
Moving home in Manchester can already be stressful enough, especially when the process starts to slow down. A cash buyer can only speed up the process, not slow it down. The mortgage process can sometimes bring trip-ups and hurdles along with it, particularly in specialist situations.
Equally, buyers taking out a mortgage can speed up the process too if they’re prepared. This means having an agreement in principle in place, being credit checked and had an affordability assessment carried out and early as possible.
A mortgage broker in Manchester like us can help you with this. In a lot of cases, we see mortgage applicants shoot through the moving home process just as fast as a cash buyer would.
You don’t owe anything
When you take out a mortgage, you are taking out a loan. This loan is a huge financial commitment; it’s likely to last well over 20-25+ years. With a cash offer, you are avoiding owing money back.
You also won’t receive interest on your offer, as you’re paying with cash. If you had a mortgage, the interest would possibly push up your monthly payments.
Why should I get a mortgage and save my cash?
When you don’t have the funds in place to make a cash offer, your next choice is to take out a mortgage.
Cheaper in the short term
Instead of using your life savings on a property purchase, you have the choice to save that money and take out a mortgage. Both options result in the same thing! And, depending on your credit score, obtaining a mortgage may only require 5% of the property’s value as a deposit.
You’ll pay back a mortgage in monthly instalments. This allows you to pay back a bit at a time and in some cases overpay if you want to. Monthly costs will vary depending on your interest rate, mortgage product and the property that you’re purchasing.
Something wrong with the house
If you’re viewing properties and the listing says “cash buyers only”, you should be careful with this property. It’s quite likely that the property has something wrong with it. If it is the case that the property is damaged/need repairs, you probably won’t be able to get a mortgage on the property anyway. You could be dodging a bullet if you are choosing a mortgage over cash here, as a cash buyer may be buying into a bad property.
Despite not having to, we’d always recommend that you get a property survey carried out on the property you’re planning to buy. This applies to both cash buyers and mortgage applicants.
A mortgage advisor in Manchester by your side
Diving into a purchase blind could put you at a slight disadvantage to someone who has a mortgage advisor in Manchester by their side. Your advisor will make things as simple as possible when helping you through your moving home process.
We aim to deliver a fast and friendly advice service. A mortgage broker in Manchester could be the thing that you need to get you through your moving home process. Get in touch with our team for a free consultation.
Lifetime ISA Explained in Manchester
Mortgage Advice in Manchester
The government’s Lifetime ISA is a fairly new scheme that was introduced in 2017. Most people, if they’ve heard of it, confuse this ISA with the Help to Buy scheme. The Help to Buy ISA was actually discontinued in 2020 when the government decided that they were going to push the Help to Buy Equity loan over its predecessor.
Surprisingly, the lifetime ISA is completely different, it can help you build up savings for your first home or save for later in life. As a Mortgage Broker in Manchester, we are going to show how the Lifetime ISA can help you buy a home as a First Time Buyer in Manchester.
For Lifetime ISA Mortgage Advice in Manchester, check out our MoneymanTV YouTube video below:
What is the Lifetime ISA?
The Lifetime ISA is a government-led scheme that helps First Time Buyers raise money for their first home or people wanting to save for later in life. ISA stands for Independent Savings Account, so the Lifetime ISA works exactly how it sounds, it’s a savings account and the best thing is that your money grows tax-free.
There is no limit to how much you can save each month, there is just a £4,000 a year cap. Also, as a bonus, the government top up your total annual savings by an extra 25%, so if you meet the £4,000 mark, you will receive an extra £1,000. This brings your total yearly savings to £5,000.
Even if you save £60 a month (£720 a year), you will receive a £180 free bonus from the government. You should know that once the money is inside of the savings account, it cannot be withdrawn without a fee.
How can I spend my savings?
There are two different ways how you can spend your savings. You can either use it to buy your first home or save it up for later in life.
You can use your Lifetime ISA savings to purchase your first home. This has to be your first purchase, it does not affect you if you’re currently renting. If you want to withdraw from the Lifetime ISA without using it to purchase your home, you’re going to have to face a 25% withdrawal charge. This is why you have to be careful of how much you’re putting into it.
As a Mortgage Broker in Manchester, we recommend looking at the Lifetime ISA when you are struggling to afford your deposit or you are planning to buy your first home within the next 5 years or more. You can keep building up your ISA until you want to withdraw the funds for your property purchase.
We only see clients who are using the ISA as their deposit for their first home. So if you are wanting to save for later in life, you can find more information here on the government’s official webpage: https://www.gov.uk/lifetime-isa.
Are there any restrictions?
There are a couple of things that you’ll need to consider when it comes to qualifying for the Lifetime ISA. Here are the requirements for when you are looking to use it to purchase your own home.
Lifetime ISA to buy your first home:
- This has to be your first home purchase
- You can only add a total of £4,000 a year
- The property that you are buying must cost £450,000 or less
- You must be under the scheme for a least a year before you can make a purchase
- You must be over the age of 18 but under 40
If you are interested in the Lifetime ISA Manchester and think that it is for you, feel free to get in touch with your Mortgage Broker in Manchester and we can help you get the ball rolling with your ISA.
Mortgage Advice in Manchester
Are you interested in the Lifetime ISA and want to begin your mortgage journey or maybe you are curious about other schemes that could match your situation? If so, now could be the perfect time to get in contact with an experienced Mortgage Advisor in Manchester.
We don’t just specialise in Lifetime ISAs, we have experience with Self Employed mortgages, Remortgages, and Buy to Lets. We love a good challenge and we would love to try and help you make that first step onto the property ladder.
Remortgaging for a Home Extension
As life goes on, you will undoubtedly want more living and breathing space in your home, it’s only natural. There are always ways to make more space; when it comes to living space, you can either physically move home or extend your current home, the choice is yours. Generally speaking, it can be cheaper to remain inside your current home as you don’t get all of the fees that are attached to moving home. So, if you’ve found a home that you can see yourself living in for years to come, it may be more beneficial to carry on living in the property.
If you choose to extend your home over Moving Home in Manchester you have to think about what you want from extending your home. Do you want a kitchen extension? A conservatory? Maybe a bigger garden? Whichever option you choose, you will still need to decide how you are going to do it.
This article is going to focus on the Remortgage side of things and how you can Remortgage your home and come out with an extension.
Remortgage Advice in Manchester
Remortgaging for home improvements
Improving your home through a Remortgage could be the smartest thing to do, especially if you’re looking for a better mortgage rate anyway.
How does it work?
When you Remortgage / take out a product transfer, you are replacing your current mortgage deal with a new one. A Remortgage is when you swap deals through another lender and not your current one and a product transfer is when you swap products but stay with the same lender.
When Remortgaging for home improvements, you’re taking out another mortgage deal (through either way of remortgaging) to incorporate the costs for the intended home improvements. Your payments might be slightly more per month or your mortgage term may just extend for a few years or more. You may be paying more, but you end up with a lovely, new home extension.
The costs of home improvements
Not only does Remortgaging for home improvements give your property a makeover, but it may also save you money on all of the fees that are associated with Moving Home.
Home improvements will likely increase your property’s value too. When it comes to selling the property further down the line, this can become incredibly useful when you are trying to get more money for your property.
Whilst it can save money, it’s worth noting that home improvements come with some significant costs of their own. These can include:
- Planning permission
- VAT
- Architects plans/services
- Materials
- Builders
- Building regulation inspections
- An Emergency Fund – Just in case things don’t quite go to plan
When to speak with a Mortgage Broker in Manchester
In order to Remortgage for home improvements, you may need to release some equity within your property. You can do this at the point of Remortgaging.
Equity Release can be quite a specialist subject, so we would recommend that you speak with a Mortgage Advisor in Manchester before making any decisions. You may not even need to go down the equity release route so it’s best to find out whether you need to or not first.
You’ll need to speak with a Mortgage Broker in Manchester in order to get the ball rolling on something like this. Remortgages tend to go a lot smoother and quicker than the first time you took out a mortgage, so you’ll hopefully be enjoying a nice and easy process once you’ve been assigned your Remortgage Advisor in Manchester.
Seizing the opportunity
Here at Manchestermoneyman, we have Mortgage Advisors in Manchester working all throughout the day to help with our customer’s needs. If you’re looking to Remortgage your current property for home improvements or would like to further discuss the pros and cons of that versus moving home, get in touch and an advisor will run through all your questions.
Remortgage Advice in Manchester for Home Improvements
Divorce & Separation Mortgage Advice in Manchester
Specialist Mortgage Advice in Manchester
The thought of separating from a partner can be quite upsetting. Unfortunately, if things don’t work out and you end up in this situation, there will be lots of things that you will need to sort out, one being your financial situation. If you are financially linked with one another, you may need to try and remove that link so that you are financially independent. This isn’t as easy as it sounds; removing your financial links from others can sometimes be complicated.
An example of a financial link to another person is a joint mortgage. Joint mortgages are mortgages in multiple names, so in this example, the mortgage would be in your’s and your ex-partner’s name. Usually, when people separate, both parties will want to have their name removed from the mortgage. Depending on your situation and your ex-partner’s situation, this can be achieved in different ways.
Divorce & Separation Mortgage Advice in Manchester
If you are going through a divorce or separation in Manchester, it’s never going to be easy. As a Mortgage Broker in Manchester, we’ve seen lots of different situations where a divorce or separation has impacted a mortgage. When people come to us for specialist help, we usually receive the same questions:
- How do I remove my ex-husband/wife from my mortgage?
- How do I remove my name from my ex-partner’s mortgage?
- Can I have two mortgages?
How do I remove my ex-husband/wife from my mortgage in Manchester?
When you are trying to remove your ex-partner’s name from a mortgage, things can get a little tricky. It isn’t just as simple as asking your lender “can you take their name off the mortgage?”, your ex-partner has to agree with it and your lender will have to determine whether both you and your ex-partner will be financially stable after the name is removed.
Firstly, before your ex-partner’s name is removed from the mortgage, you will have to demonstrate your ability to pay the mortgage payments on your own. This also means that you aren’t allowed any help from your ex-partner, whether or not they’ll let you remove another name depends on whether your sole income allows you to meet the mortgage payments. You should also know that at the point of your application, you both were associated with the deal, therefore if you fall into arrears, the lender can pursue either of you.
Typically, if you are trying to remove your ex-partner’s name from a mortgage, you are going to remain living inside of the property. We find that if there are children involved, it’s usually the case that the mother stays inside the family home, however, regardless of gender, it’s entirely up to you to decide who carries on living on within the property.
In the past, we have seen struggling customers have family or friends who were willing to step in and offer a helping hand. If you have this option available and you can get someone to help you with your mortgage payments, the lender may be more likely to accept your application to get your ex-partner removed.
How do I remove my name from my ex-partner’s mortgage?
Depending on your situation, it can sometimes be easier to remove your own name from a mortgage. From our experience, if you’re removing your own name from a mortgage, it’s likely that you are the person planning to move out of the property. If you move out of the property before being removed from the mortgage, you should know that you are still liable for the mortgage payments. This is still the case even if you have made an arrangement with your ex-partner that you will not contribute to any of the payments.
If you are still tied into a mortgage with an ex-partner and you try to get another mortgage, you should know that your chances of being accepted might be lowered. A lender may be put off if they can see that you are linked with another mortgage that you still hold accountability for. If you manage to remove yourself from the mortgage and you can evidence that you’ll be able to meet your mortgage payments, you will stand a higher chance of being accepted by them.
As a Specialist Mortgage Broker in Manchester, we deal with situations like this all of the time. Occasionally, there is someone, perhaps a new partner or family member, willing to offer a helping hand. If you are lucky enough to be in this situation, the lender may be more likely to accept your application for a new mortgage despite you being linked to another one.
Lenders will always consider both sides of the argument. They will look at whether your ex-partner can successfully afford the payments on their own or whether they still need your help. On the other hand, they will also look at your situation, will you be able to manage a mortgage on your own? When they are making this decision they will factor in your current mortgage payments and see if you were handling them okay too.
Some lenders may be more generous when it comes to the amount they’re willing to lend you compared to others. A Mortgage Broker in Manchester like ourselves is specialised in this area, we know what lenders are looking for in applications and which lenders offer these specialist products suited for your situation. We have access to thousands of mortgage deals across our panel of specialist lenders in Manchester.
Can I have two mortgages?
Although it’s entirely possible to obtain two mortgages (or more in some cases), a mortgage lender will only lend you a second mortgage if they are certain that you’ll be able to manage both of them.
When going through a divorce or separation and you are linked to a mortgage with your ex-partner, even if you aren’t contributing towards the mortgage payments, you are still financially tied with it and therefore you may oppose a threat to lenders. If your ex-partner fails to meet their payments, the lender has the complete right to pursue you to get money off you. This is why if you are planning to get a second mortgage, yet are still paired to another deal, your chances may be lowered of being accepted for a mortgage.
We are not saying that it’s impossible to get a second mortgage when you are linked to an ex’s mortgage, it may just be a little harder. It’s more likely to be made possible through the use of specialist lenders and a good credit score. If you decide to get Specialist Mortgage Advice in Manchester, you could get a bigger picture of your situation and all of the options available to you.
Of course, you could go directly to your bank, however, if you think smartly and approach a divorce and separation mortgage specialist, you may get the ball rolling a lot quicker and could be looking at deals in no-time. Our mortgage service includes calculating how much you could borrow, working out a budget for you and how much deposit you’ll need to put down.
Moving on from previous joint financial commitments can be quite difficult. Just bear in mind that as far as lenders are concerned, it’s all about the risk. They ideally look to avoid repossession situations at all costs. For further Specialist Mortgage Advice in Manchester, get in touch with our fantastic mortgage team today.
Mortgage Advisor in Manchester
