What Does Remortgage Mean?
Remortgage Advice in Manchester
If you have just bought your first home in Manchester and your current mortgage deal is ongoing, you may not have heard of a remortgage before. On the other hand, if you have been living in your property for a long period of time, you may have a rough idea of what remortgage means and when the point of remortgage is.
Defining a Remortgage in Manchester
Remortgaging, also known as financing, is simply the process of taking out a new mortgage deal with a new lender to replace your current product. Usually, a remortgage takes place when your current deal is coming to an end.
Key Elements of Remortgaging in Manchester
Let’s take a look at the main parts of a remortgage and how the process works.
Changing Mortgage Lenders
When you remortgage in Manchester, you will be taking out a product with a new lender. Taking out a new product with a different lender could help you potentially open yourself up to products with better interest rates. As a mortgage broker in Manchester, we also see that homeowners remortgage in Manchester for better customer service, more favourable mortgage terms and excess specialist products that their current mortgage lender does not offer.
Renegotiating Terms
If you are happy with your current mortgage but want to slightly alter the terms of the product, remortgage is an option. Remortgaging could allow you to extend or shorten your mortgage term or even change products completely, such as a switch from a fixed rate to a variable rate!
Releasing Equity
For those looking to take money out of their home, remortgaging to release equity is a viable option. If your current lender is not letting you take equity out of your home through a remortgage, other mortgage lenders may allow you to do so. There are many specialist lenders out there that offer products that can allow you to do this. Our team at Manchestermoneyman will be more than happy to help you explore equity release in Manchester and look at your options with you.
Reasons to Consider a Remortgage in Manchester
Now that you know what a remortgage means, let’s look at some reasons why people will want to remortgage in Manchester.
Avoid Lender’s Standard Variable Rate (SVR)
When you are approaching the end of your fixed mortgage term, if you do not remortgage, you will fall onto your mortgage lender’s standard variable rate of interest (SVR). It is more than likely that this rate is much higher than the current rate you have been paying. When you remortgage, you are taking out a new product and will avoid falling onto the lender’s SVR.
Lower Interest Rates
Linking with the reason above, searching around for a new remortgage product could allow you to access better rates of interest. In turn, this would reduce your monthly mortgage repayments.
As a mortgage broker in Manchester, it is our job to help you find the perfect remortgage product for your personal and financial situation. We will always try and save you time and money where we can!
Repayment Flexibility
Remortgaging can allow you to modify your mortgage repayment structure. Homeowners do this to make their payments more manageable. This could mean switching the type of mortgage they have on their property or shortening/extending their mortgage term.
Home Improvements
If you feel as if your home could do with some improvements, you may be able to incorporate some of the costs of these improvements into your mortgage. This is done via a remortgage for home improvements. The way that this works is that you would add the costs of the works to your total mortgage amount and then your monthly repayments will go up each month to accommodate the costs of the works. Depending on the work you’ve done, your payments may only rise by an extra £30 or £50.
Debt Consolidation
If you have built up debt, such as credit card balances or personal loans, you may be able to remortgage to consolidate this debt into your mortgage. It could make paying off your debt a little more manageable. We would always recommend speaking with an expert mortgage advisor in Manchester before consolidating debt into your mortgage, there are other options to explore first before doing this.
Accessing Equity
Your property value will likely increase over time. Remortgaging may allow you to access this extra equity in your home. Equity is essentially just how much money you have put into your home/mortgage, and you can withdraw a portion of this equity and use the cash as you like! We see that people use the money for all sorts of things, such as buying a new car or booking a holiday.
Speak to a Mortgage Advisor in Manchester
Remortgaging can be a complex process and getting remortgage advice in Manchester could help you find the perfect remortgage product. We are able to search through 1000s of remortgage products on your behalf to find a deal tailored to your personal and financial situation.
Remember to do your research, don’t rush into any deal and get the remortgage advice in Manchester that you need!
How Soon Can You Remortgage in Manchester Before Fixed Rate Ends?
Timing is key when considering remortgaging in Manchester before the conclusion of your fixed-rate mortgage deal. Our recommendation is to begin this process approximately six months before your current mortgage arrangement expires.
This well-timed strategy ensures a smooth transition to your new mortgage deal, seamlessly taking over just as your old one is about to conclude. This approach minimises any potential financial disruptions and helps maintain your financial stability.
Understanding Fixed-Rate Mortgages in Manchester
Before we delve into the timing considerations of remortgaging in Manchester, let’s take a moment to explain the concept of a fixed-rate mortgage.
A fixed-rate mortgage offers a steady and unchanging interest rate over a predetermined term, typically spanning two to five years. This stability in the interest rate provides borrowers with financial predictability, making it easier to manage their budgets.
Can You Remortgage in Manchester During a Fixed-Rate Term?
Certainly, remortgaging in Manchester while you’re still in the midst of a fixed-rate period is possible, but there are some important factors to keep in mind:
Early Repayment Charges (ERCs)
Fixed-rate mortgage agreements frequently come with Early Repayment Charges (ERCs). These charges are applied when you repay or remortgage your mortgage before the fixed-rate period concludes. ERCs are usually calculated as a percentage of your remaining mortgage balance.
It’s worth noting that this percentage tends to reduce as you approach the end of your fixed-rate term. This can make remortgaging a more financially viable option as you get closer to the term’s conclusion.
Timing Matters
To mitigate Early Repayment Charges (ERCs), many borrowers choose to remortgage in Manchester during the later phases of their fixed-rate period, aligning with the suggested six-month timeframe.
As your fixed term nears its conclusion, ERCs tend to decrease, lessening the financial burden of remortgaging. Nevertheless, it’s advised that you consider the time needed to secure a new mortgage deal and ensure a seamless transition.
Lender Policies
Lenders have diverse policies regarding remortgaging in Manchester within a fixed-rate period.
Certain lenders permit you to initiate the process as early as six months before your fixed rate concludes, while others may have different timeframes. It’s very important to review your lender’s terms and conditions to understand their specific policies and timelines.
Market Conditions
Stay vigilant about the current mortgage market conditions. If interest rates have substantially decreased since you secured your fixed-rate mortgage, it might be beneficial to consider early remortgaging in Manchester, even if it incurs ERCs.
The potential savings from lower interest rates can potentially outweigh the costs associated with ERCs.
Remortgaging Benefits in Manchester
Remortgaging while in the midst of a fixed-rate period can offer several compelling advantages. Firstly, if market interest rates have fallen since you initially secured your fixed-rate mortgage, you may have the opportunity to secure a new mortgage deal with a lower interest rate.
This can translate into tangible savings through reduced monthly payments, making it an attractive option for homeowners. Additionally, remortgaging during a fixed-rate period allows for the renegotiation of mortgage terms.
This means you can tailor your mortgage to better align with your evolving financial goals. Whether it involves transitioning from a fixed-rate to a variable-rate mortgage or adjusting the repayment period, this flexibility can be a valuable financial tool.
Furthermore, as property values tend to appreciate over time, remortgaging provides the means to tap into this accrued equity.
Whether you’re looking to undertake home improvements, consolidate debt, or address other financial needs, the equity in your property can be a valuable resource that remortgaging in Manchester can unlock.
In summary, remortgaging during a fixed-rate period can be a strategic move to capitalise on lower interest rates, improve mortgage terms, and access your property’s equity for various financial purposes.
The Remortgaging Process in Manchester
When considering remortgaging during a fixed-rate period, it’s crucial to start with a thorough assessment of your current mortgage terms.
This includes examining factors like the interest rates on your existing mortgage and the potential Early Repayment Charges (ERCs) you might incur. Simultaneously, it’s essential to have a clear understanding of your broader financial objectives.
Following the assessment, the next step involves conducting comprehensive market research. This entails exploring the various mortgage deals and lenders available in the market. The objective here is to identify a remortgage option that seamlessly aligns with your specific financial goals and preferences.
Once you’ve identified a suitable remortgage deal, it’s time to initiate the application process. During this stage, you’ll be required to submit your application and provide the necessary financial documentation that supports your request.
Subsequent to your application, the lender you’ve selected will arrange for a property valuation. This valuation is instrumental in determining the current market value of your property, which, in turn, plays a pivotal role in establishing the Loan-to-Value (LTV) ratio.
Following approval from your chosen lender, the final phases of the remortgage process come into play. Your existing mortgage will be settled, and the terms of your new mortgage agreement will be put into effect.
This ensures a smooth transition to your selected mortgage terms, potentially offering advantages like lower interest rates or improved financial flexibility.
Seeking Professional Mortgage Advice in Manchester
Remortgaging can indeed be a multifaceted process with significant financial implications, which is why consulting a qualified mortgage advisor is highly advisable.
These experts can provide you with invaluable guidance, thoroughly assess your unique circumstances, and empower you to make well-informed decisions regarding the timing of your remortgage in Manchester.
A strategic approach to remortgaging involves timing it approximately six months before your fixed-rate mortgage deal concludes. This careful timing aims to facilitate a smooth transition to a new mortgage arrangement while allowing you to minimise the impact of early repayment charges (ERCs).
Simultaneously, it offers the potential benefit of securing a new mortgage deal with lower interest rates and more favourable terms. As with any substantial financial decision, seeking remortgage advice in Manchester can prove to be an invaluable step.
Their insights and knowledge can ensure that your remortgaging journey is not only seamless but also financially advantageous.
Do You Need a Deposit to Remortgage in Manchester?
When considering remortgaging in Manchester, it’s not unusual for homeowners to question whether a deposit is a prerequisite. After all, deposits are typically linked to buying a new property, not to the process of refinancing an existing mortgage.
Understanding the Basics: What is a Remortgage in Manchester?
Before we delve into the topic of deposits concerning remortgages, it’s important to gain a comprehensive understanding of what a remortgage in Manchester entails.
In essence, a remortgage involves the process of either transferring your existing mortgage to a new lender or renegotiating the terms of your current mortgage with your existing lender.
Individuals contemplate remortgaging in Manchester for a multitude of reasons, ranging from securing a more favourable interest rate to exploring the potential of releasing equity through the remortgage route or adapting their mortgage type to better suit their changing financial circumstances.
The Role of a Deposit in Remortgaging in Manchester
The reassuring news is that, for the most part, remortgaging in Manchester doesn’t necessitate a deposit. Unlike the process of buying a new home, where a deposit is typically required to secure a mortgage, remortgaging primarily hinges on the equity you’ve accumulated in your existing property.
Leveraging Your Home Equity
When you embark on the journey of remortgaging in Manchester, the equity in your home takes centre stage. Equity signifies the share of your property’s value that you fully own, and it steadily grows as you consistently make mortgage payments.
To illustrate, consider your home’s current valuation at £300,000. If your remaining mortgage balance stands at £200,000, your equity amounts to £100,000. This equity is a valuable asset that can open doors to various remortgaging opportunities.
The Loan-to-Value Ratio (LTV)
Rather than relying on a deposit, remortgages in Manchester are commonly determined by an important metric known as the loan-to-value (LTV) ratio.
The LTV ratio assesses the sum you plan to borrow in relation to your property’s current market value. In Manchester, many homeowners strive for a lower LTV, as it often leads to more attractive remortgage options.
Deposit for Specific Remortgage Situations
While most standard remortgages in Manchester don’t necessitate a deposit, there are specific situations in which it could become relevant:
Adverse Credit History
If you have a history of credit issues, it’s conceivable that some lenders may request a deposit as a precautionary step to mitigate risk. This deposit acts as a security measure, offering assurance to the lender in case of potential payment challenges.
Releasing Equity
If you’re considering a remortgage in Manchester with the aim of releasing a significant amount of equity, it’s important to be aware that some lenders may request a deposit as a means to manage their financial risk.
This additional deposit serves as a mechanism for lenders to limit their exposure when you’re unlocking a substantial portion of your property’s equity.
Additional Considerations
It’s vital to keep in mind that the remortgage process comes with various associated costs, such as arrangement fees, valuation charges, and legal expenses. These expenses should be factored into your decision-making process as you weigh the pros and cons of remortgaging.
Speaking with a Mortgage Advisor in Manchester
When it comes to navigating the intricacies of remortgages in Manchester, the process can often appear complex. Therefore, the most important step to take is to seek guidance from a qualified mortgage advisor in Manchester.
An experienced mortgage advisor in Manchester possesses the expertise needed to meticulously evaluate your unique circumstances. They can help you in identifying the most suitable remortgage solution and provide invaluable guidance throughout the entire process.
In summary, it’s essential to understand that the majority of remortgages in Manchester typically do not require a deposit. Instead, the pivotal factors in this process revolve around your existing equity and the loan-to-value ratio.
To ensure a seamless remortgage experience tailored to your specific needs, it is definitely recommended to seek remortgage advice in Manchester.
They will conduct a comprehensive assessment of your financial situation, explore various options, and work diligently to secure the most advantageous remortgage deal on your behalf.
What Does a Mortgage Broker in Manchester Do?
Why use a mortgage broker in Manchester?
If you are looking to try and save both your time and money, reduce your stress levels and worry less about the process, there is a lot of upside to taking on the help of an expert mortgage broker in Manchester.
As professionals with a lot of experience, we have access to thousands of deals, able to pick and choose one that is best suited for your particular situation. Going directly to the bank, on the other hand, see’s you with access to only one lender’s mortgage deals, as opposed to a look at multiple.
Appointments That Work With Your Busy Day-to-Day Life
Our team are available to get you booked in for an appointment, 7 days a week, from early until late, working around your busy schedule.
You are also able to utilise our website’s booking form, to select a video or telephone consultation with a mortgage advisor in Manchester, at a time that is convenient to you.
Before Your Application
In order to progress with a mortgage as a first time buyer in Manchester, you will first need to look at having an appointment to speak with a mortgage advisor in Manchester.
Throughout the duration of this meeting, you will be providing them with additional information that will serve to help them better understand your circumstances and your plans. Following on from this, they will then take a look at a wide variety of mortgage deals in order to find the right one for you.
First time buyers in Manchester and people moving home in Manchester that are happy to proceed with the recommendation of their mortgage advisor, will benefit from receiving an agreement in principle (AIP). We look to get this for our customers, within 24 hours of their initial appointment.
This is a useful document to have, as estate agents will ask for this when you are making an offer on a property. It showcases that you are committed to the purchase and that you are in fact financially able to proceed with your purchase, having a mortgage lender on standby willing to lend.
We are able to support and guide you with your offer process, help with property surveys and also make any insurance recommendations (that are completely optional) that could act as a safety net to protect your family and your home from unforeseen circumstances.
You will also need to provide your mortgage advisor with appropriate documentation to go along with your mortgage application, with these varying depending on what it is you’re trying to do and who you will be working with. This is something we’ll also help you with as a mortgage broker in Manchester.
During Your Application
Once your documents have ben received, as a mortgage broker in Manchester, we will verify those documents and provide you with a mortgage illustration that will outline the deal that you have agreed to, with the mortgage lender we recommended. This is done just before we submit your application.
Your application is then submitted, following your approval of our recommendation, with your mortgage advisor in Manchester sending copies of your documents to the mortgage lender. We will keep in regular contact with you, to ensure you are kept up-to-date with the progression of your application.
We’ll be straight back in touch with you once the mortgage lender has made a decision on your application. If it is successful, this is where you will receive a formal mortgage offer. From here, it’s all up to your solicitor to complete the deal and allow you to move into your new home.
Our Mortgage Advice in Manchester Service
As a mortgage broker in Manchester, we always like to make sure that your best interests are at the hear of everything that we do. If we can save you time, save you money and save you stress, we will do so. We want to help put you in the best financial position you can be in.
Our customer reviews are a genuine look at the long lasting relationships we build with those who get in touch with us, showing the positive impact that owning a home, by way of our mortgage advice service, has had on them as individuals.
What is a Shared Ownership Mortgage in Manchester?
The Shared Ownership Scheme is a government-initiated mortgage program in the UK, aiming to aid individuals in stepping onto the property ladder. It’s accessible to permanent UK residents who fall into the category of either first time buyers or previous homeowners struggling to acquire a new property.
Furthermore, your household income must not exceed £80,000, and the property you intend to purchase will predominantly be on a leasehold basis. Leasehold signifies that you’ll possess the property for a predetermined duration.
Through Shared Ownership in Manchester, you can secure your home through a combination of a mortgage and rental payments. The total of your rental payments will usually be lower than your mortgage payments.
What percentage of the property in Manchester can I borrow?
When Shared Ownership was first introduced, the minimum share that you could own was 25%, whereas now, this has been brought down to 10% for some properties.
There is an option for homeowners to increase the percentage share that they own their home. This is called staircasing. This is usually done at the point of remortgage or when the homeowners have paid off the mortgage on the share that they own.
If you decide that you want to increase your shares, you can now purchase them in 1% instalments. This used to be in 5-10% increments.
Moreover, the charges increasing your extra shares have been lowered. Additionally, your landlord will cover the maintenance and repair expenses for the first decade of ownership.
The rules that apply to you and your Shared Ownership in Manchester may change depending on when you originally took out the mortgage. As a mortgage broker in Manchester, we recommend double-checking what you can and can’t do in relation to the new rules of Shared Ownership. Drop our mortgage advisors in Manchester a message if you are unsure about how your property is affected.
How do I apply for a Shared Ownership mortgage in Manchester?
To access the Shared Ownership scheme in Manchester, you must first qualify for the scheme. The scheme is not for everyone, so it is worth checking that it is right for you before applying for it.
To check whether you are eligible for the Shared Ownership scheme in Manchester, you’ll first need to get in touch with your local Help to Buy agent in the area you are looking to purchase in.
You will need to give them information such as your income, budget, preference of where you would like to live in the area and your credit history. Once you have confirmed your eligibility, the next step is to begin preparing your mortgage application.
Using a mortgage broker in Manchester like us is your best bet from here. Not every mortgage lender will be able to offer their help with Shared Ownership mortgages, yet a mortgage broker has access to thousands of deals through various lenders.
Pros & Cons of Shared Ownership in Manchester
There are pros and cons to Shared Ownership in Manchester, just like every Help to Buy scheme out there.
Pros of Shared Ownership
Saving for a mortgage deposit is often a worry among first time buyers, the Shared Ownership scheme usually only requires you to put down a deposit on the percentage of the property that you own. For example, if you are taking a mortgage out on 20% of a property valued at £200,000 (£40,000 mortgage) and you are required to put down a 10% deposit, you will only need to put down £4,000 deposit.
Numerous mortgage lenders, including those on our panel, provide Shared Ownership mortgage products. The scheme has become more popular over the last few years and first time buyers are opting for this scheme to help them get onto the property ladder. Moreover, Shared Ownership Mortgages can provide enduring stability as you become both an owner and occupant simultaneously.
You may get the chance to purchase your property in the future if that is something you are looking to achieve. If you want to eventually own the property, before taking out a Shared Ownership mortgage in Manchester, you should make sure that this is an option for you in the future because some building societies do not allow this. Whether you can purchase the property in the future or not will be in your contract.
You’ll enjoy secure tenure, unlike the uncertainty of the private market. As long as you can maintain your monthly mortgage payments, you can continue residing in your home for the duration of your lease, usually spanning from 99 to 125 years.
Cons of Shared Ownership
While there are many advantages to Shared Ownership, you also need to be aware of the cons. It’s important to note that you’ll be responsible for 100% of the ground rent and service charges for your property, regardless of the size of your purchased share.
As your home will be co-owned, you must seek approval from the relevant housing provider before making any structural alterations. This requirement might limit the sense of complete ownership freedom you’d typically have.
Can I sell my home if I have a Shared Ownership Mortgage in Manchester?
After a while of living within your Shared Ownership property in Manchester, you may decide that you want to move on and start looking at moving home. With most other mortgage types, this would be simple enough, however, with Shared Ownership, the process works slightly differently.
Whether you can sell your home depends on how much of the property you own. Usually, you are required to own 100% shares in the property before you are able to sell it.
Nevertheless, it’s important to recognise that the housing association usually retains ‘first refusal’ rights for the initial 21 years following your home purchase. Legally, this grants them the opportunity to present a purchase offer for the property before you consider selling it on the open market.
If you do not own 100% of the property, your first step is to try and purchase the remaining shares in the property and then look at selling it.
Is a Shared Ownership Mortgage in Manchester right for me?
Shared Ownership is not for everyone by any means. Most of the time, as a mortgage broker in Manchester, we find that sole applicants and those struggling to save for a deposit most benefit from the scheme.
Taking out a Shared Ownership in Manchester requires you to meet a criteria. To see whether you qualify for the scheme, reach out to our mortgage advisors in Manchester and we can take a look at your circumstances.
To speak with the team, simply give our team a call or book a free mortgage appointment online. We would love to offer a helping hand to make your Shared Ownership process stress-free!
Can You Get a Mortgage With Bad Credit in Manchester?
Bad Credit Mortgage Advice in Manchester
As a mortgage broker in Manchester, we regularly work with customers seeking help with bad credit due to issues like missed payments, low credit scores, CCJs, and defaults, among others.
Repeatedly missing payments, such as on a mobile phone contract, could lead to a default being linked to your credit record. This may pose challenges if you’re considering a future mortgage application, suggesting potential payment unreliability.
Fortunately, having missed payments or defaults doesn’t mean that it is impossible to get a mortgage. To increase your chances, we would always recommend getting specialist mortgage advice in Manchester from a professional.
You should know that you may have to provide a large deposit if you are looking to get a mortgage with bad credit in Manchester. This deposit may stretch to 10%-15% of the property’s value.
Mortgage lenders will want to know exactly why you have bad credit. They will also look at how long you have had bad credit; if you have bad credit because you received a default recently, your chances are significantly reduced, however, if you received the default years ago and haven’t been missing payments for a long period of time now, you may find that your chances are higher.
Mistakes happen, and having bad credit in Manchester should not make you stop pursuing your mortgage process. There are specialist mortgage products out there for bad credit mortgage applicants, these deals could be suitable for you and your personal and financial situation.
Bad Credit Mortgage FAQs in Manchester
In our twenty years of experience, we have come across almost every single type of specialist mortgage situation. No matter the situation, we will always try and help when we can.
Every applicant with bad credit in Manchester will undoubtedly have lots of questions they want answers to – getting a mortgage can be complicated enough! Here we have compiled a list of the most common questions asked by applicants with bad credit in Manchester.
I have been declined by my bank for a mortgage in Manchester, can you help?
As a mortgage broker in Manchester, many of our customers have come straight from their bank after being declined for a mortgage. We advise that you do not keep applying to your bank because the more that you are declined, the more harm you are posing on your credit.
We advise that you get in touch with our mortgage advisors in Manchester to discuss your current mortgage options. We may be able to help, even if you think that your situation is too complicated!
What will my mortgage advisor in Manchester need to see?
Regardless of the nature of your previous credit issues, your mortgage advisor in Manchester will require a current version of your credit report.
Obtaining your credit report before initiating a mortgage application is crucial, particularly if you’re uncertain about your credit history. Our mortgage advisors in Manchester can perform a credit check for you that comes at no cost and will not affect your credit. If you keep performing numerous credit checks it can negatively impact your credit score and potentially hinder your mortgage eligibility.
Can I still get a mortgage in Manchester with a good income but bad credit?
The response to this question depends on your circumstances. For certain individuals, while their credit score might not be considered “good”, they may possess a substantial deposit to secure a lower rate and a steady income. Yet still, due to perceived risk, a mortgage lender could refuse to lend to this applicant.
Mortgage lenders require evidence that you can consistently meet mortgage payments, preventing any likelihood of falling into arrears. Repossessing your home becomes a necessity for them only in dire situations; it’s a scenario they prefer to avoid.
Although it may seem like it’s impossible, pathways for bad credit mortgages do exist. You may just have to settle for a higher interest rate on your mortgage. To discuss your options you should speak with a professional mortgage advisor in Manchester.
I’ve had mortgage problems before. Will that stop me from getting a mortgage in Manchester now?
Unfortunately, some people do miss their mortgage payments and it can have a negative impact on their credit. Even if it was just once and there’s a plan to pay it back as soon as possible, a missed payment can still register on your record.
If this is more than just a one-time occurrence, then you may start to see your actions reflect in your credit. When the time arrives to remortgage in Manchester, purchase a new home, or invest in a buy to let property, challenges may arise. Remember that your mortgage lender is looking for reliability and trustworthiness in your credit history.
What other types of adverse obstacles are customers facing?
Applicants can encounter many different types of bad credit mortgage scenarios. Each are capable of introducing significant hurdles throughout the mortgage application journey. Some of these issues include, yet are not restricted to:
- Missed Mortgage Payments
- Defaults on Credit Cards or Loans
- County Court Judgements (CCJs)
- Bankruptcy
While none of these circumstances are ideal, they do not mean that you cannot get a mortgage. Although you may face a slightly more difficult process, potentially with increased mortgage rates, specialist mortgage lenders exist that can help.
Get in Touch for Bad Credit Mortgage Advice in Manchester
For specialist mortgage advice in Manchester, you should reach out to our team at Manchestermoneyman. We know that having bad credit can make the mortgage process seem daunting, and that’s why we want to offer a helping hand.
We offer a free mortgage appointment to every customer, simply book online or give us a call and arrange a date and time.
Your Essential Mortgage Guide: Answering Your Top Questions in Manchester
Are you seeking valuable mortgage tips and advice to ease your path to homeownership? We fully understand the uncertainties and questions you may have that may arise during this process.
In this article, our primary objective is to address your most pressing questions and offer insightful guidance to empower you in navigating the mortgage landscape with confidence.
Whether you’re a first time buyer in Manchester or exploring remortgage in Manchester, we’ve got you covered. Let’s work together to transform your homeownership dreams into a gratifying reality!
How much can I afford to borrow?
Evaluating your borrowing capacity is a fundamental aspect of the mortgage process. Consider factors such as your income, expenses, and existing debts.
You can start with online mortgage calculators to get a rough estimate, but for a more precise and tailored assessment, it’s advisable to consult with a dedicated mortgage advisor in Manchester.
Their expertise will provide you with accurate insights based on your unique financial situation, empowering you to make well-informed decisions and set yourself on the path to securing your ideal mortgage.
What are the current mortgage interest rates?
Staying well-informed about interest rates is vital for making informed decisions during your mortgage journey.
Keep yourself updated by following financial news, reputable websites, or seeking advice from knowledgeable mortgage advisors in Manchester who can provide real-time updates on interest rates.
Having a clear understanding of the current market trends will give you the power to make the best choices for your mortgage. You can also explore our YouTube channel, MoneymanTV, where we regularly upload monthly market updates related to this topic.
By staying informed about the latest trends and insights, you’ll be better equipped to navigate your mortgage journey with confidence and make well-informed decisions.
What types of mortgages are available?
It’s essential to take the time to explore the various mortgage types available, such as fixed-rate, adjustable-rate, and interest-only mortgages. Each option comes with its unique features, benefits, and considerations.
To make the best decision, conduct thorough research and seek mortgage advice in Manchester from mortgage experts. They can help you identify the most suitable mortgage type that aligns perfectly with your specific needs and financial goals.
By doing so, you’ll be better equipped to choose the mortgage that best fits your circumstances and sets you on the path to successful homeownership.
How can I improve my credit score?
Building a strong credit score is essential for securing favourable mortgage terms. To achieve this, make sure to pay your bills on time, maintain a low credit utilisation ratio, and regularly review your credit report for any errors or discrepancies.
If you come across credit-related challenges, don’t worry. There are various agencies and resources available to offer assistance and guidance in improving your credit situation.
By taking proactive steps to manage your credit, you can enhance your chances of qualifying for a mortgage with better terms and conditions.
What documents are required for a mortgage application?
Typically, standard documentation required for a mortgage application includes proof of income, identification, bank statements, and employment history.
To ensure a personalised and seamless mortgage application process, it’s best to seek advice from mortgage lenders or experienced mortgage advisors in Manchester.
They can help you in preparing a tailored list of necessary documents based on your specific financial situation and individual needs. With their expertise, you can navigate the documentation process with confidence, increasing the likelihood of a successful mortgage application.
Should I use a mortgage broker in Manchester or go directly to a mortgage lender?
Both options present unique advantages. As a mortgage broker in Manchester, we can offer access to multiple lenders, enabling comprehensive comparisons to find the best mortgage offers tailored to your requirements.
On the other hand, approaching a mortgage lender directly establishes a direct relationship. We recommend considering your preferences, conducting thorough research, and seeking recommendations to make an informed decision that aligns with your specific needs and financial goals.
Whether you choose to work with a mortgage broker in Manchester or approach lenders directly, the key is to find a solution that suits you best on your home buying journey.
What are the associated costs and fees?
It’s essential to consider expenses beyond the mortgage amount, such as arrangement fees, valuation fees, legal fees, and potential early repayment charges. Take the time to carefully review fee schedules from different mortgage lenders to gain a full understanding of all the costs involved.
To ensure you are well-informed about these expenses, seek advice from mortgage professionals who can guide you through the details and help you make informed decisions. Being aware of the complete financial picture will enable you to plan effectively and avoid any surprises along the way.
How can I save for a deposit?
Achieving a deposit for your home requires discipline and thoughtful preparation. Begin by creating a budget that helps you track your income and expenses. Look for areas where you can cut unnecessary spending to save more effectively.
Explore government schemes designed to help homebuyers, such as Help to Buy in Manchester or Right to Buy in Manchester, keeping in mind their specific eligibility criteria. These schemes can provide valuable support in your journey towards homeownership.
Consider opening high-interest savings accounts or first time buyer ISAs, which are designed to accelerate your savings with attractive interest rates and potential government contributions.
By implementing these strategies, you can take significant steps towards building your deposit and achieving your dream of owning a home in Manchester.
What is the difference between a mortgage agreement in principle and a formal mortgage offer?
An agreement in principle (AIP) offers an initial estimate of the mortgage amount a lender may be willing to offer, based on fundamental information provided by the borrower.
In contrast, a formal mortgage offer represents a legally binding document, demonstrating the lender’s commitment to providing the loan under specific conditions.
It serves as a significant milestone in the mortgage process, as it outlines the terms and conditions of the mortgage and sets the groundwork for finalising the home purchase.
How long does the mortgage application process take?
The timeline for processing a mortgage application can vary and typically takes several weeks on average. Various factors, such as the property type, credit history, and the efficiency of document submission, can influence the duration.
To ensure a smoother and more efficient process, it’s essential to work closely with your mortgage advisor in Manchester and be well-prepared for any potential delays that may arise.
By staying proactive and organised throughout the application process, you can help expedite the journey to securing your dream home.
Get Mortgage Ready!
Armed with these vital answers to your key mortgage questions, you are now ready to set off on your exciting mortgage journey.
Remember, seeking guidance from trustworthy mortgage advisors in Manchester, conducting thorough research, and staying proactive throughout the process are all crucial elements.
By following these steps, you can confidently pursue your dream of homeownership and take the necessary actions to make it a reality!
Do First Time Buyers in Manchester Pay Stamp Duty?
Please note that the information contained in this article is for general guidance purposes only and should not be considered as legal, financial, or tax advice.
All information regarding Stamp Duty is taken from the government website and is in-line with the September 2022 Mini-Budget. The laws and regulations related to Stamp Duty are subject to change, and the information in this article may not reflect the latest updates or changes in the law.
The amount payable for Stamp Duty will entirely depend on personal circumstances. Please speak with the solicitor acting on your behalf, who will be more appropriate to advise on this.
Information Source: MoneyHelper
Stamp Duty Land Tax is a tax that applies to residential property owners in England or Northern Ireland, including those with mortgages and those who have bought properties outright.
First time buyers in Manchester can benefit from Stamp Duty relief on properties valued at £425,000 or less, with a reduced rate applied to properties valued between £425,000 and £625,000. Properties valued over £625,000 do not qualify for first time buyer relief, and the standard rates of Stamp Duty apply.
These rules are currently in effect until March 2025, after which the previous thresholds will be reinstated.
Why was Stamp Duty relief introduced for first time buyers in Manchester?
In an effort to increase affordability in the property market, the government implemented changes to Stamp Duty regulations specifically aimed at first time buyers in Manchester.
As you may know, accumulating enough funds for mortgage applications, deposits, and conveyancing fees can already be a daunting task.
Unlike existing property owners who can rely on the equity in their homes, first time buyers in Manchester, often renters, may not have the same level of equity to help cover these expenses.
Are there any exceptions to the rule?
As mentioned earlier, there are exceptions to the Stamp Duty regulations. Properties valued between £425,000 and £625,000 incur a percentage of the amount exceeding £425,000, while properties valued over £625,000 do not qualify for first time buyer relief.
It’s important to note that even if you have inherited a property and have never owned a home before, you are not eligible for first time buyer relief.
The same applies if you are purchasing a property jointly with someone who is not a first time buyer in Manchester themselves or if you are considering a first time buyer buy to let property.
In the latter case, Stamp Duty will be applicable, and the amount will vary based on your specific circumstances, so it’s advisable to consult with your solicitor for more information.
How do I pay stamp duty?
Typically, your solicitor will take care of filing the Stamp Duty return and handling the payment process on your behalf. However, you have the option to handle it yourself if you prefer.
Regardless, it is your responsibility to ensure that the return is filed within the designated timeframe. Even if you are not required to pay Stamp Duty, you must still submit a return unless you qualify for an exemption.
It’s important to be aware that the rates and regulations for Stamp Duty may differ depending on the property’s location.
To ensure you have a clear understanding of the specific tax rules that apply to your property purchase, it is advisable to consult with your solicitor or conveyancer.
Additional Costs for First Time Buyers in Manchester: What Else to Consider?
In addition to the Stamp Duty expenses, if you’re applying for a first time buyer mortgage in Manchester, it’s important to consider other potential costs involved.
One significant cost is your deposit, which is typically a minimum of 5% of the property’s value. If you have a history of poor credit or aim for better interest rates, a deposit of 10-15% might be more beneficial.
Furthermore, you should anticipate solicitors or conveyancing fees as a definite cost.
Additionally, there may be various fees and expenses that could apply to your specific case, such as a mortgage arrangement fee charged by your mortgage lender, valuation and survey fees, and potentially a fee from a mortgage broker in Manchester if you choose to use one.
Other general expenses to consider include removal costs, potential repairs, furnishing expenses, and home insurance.
It’s worth noting that not all of these costs are mandatory and can vary depending on your circumstances. To gain a more accurate understanding of the potential expenses you might encounter on your path to homeownership, consulting a mortgage advisor in Manchester is highly recommended.
Is there any support available for first time buyers in Manchester?
For first time buyers in Manchester struggling to enter the property market, it’s reassuring to know that assistance is at hand. In addition to Stamp Duty relief, there are several schemes available to facilitate home ownership.
Shared Ownership mortgages, enabling the purchase of a share in a property with rent paid on the remainder, and Forces Help to Buy (FHTB) in Manchester, which offers interest-free loans of up to 50% of their salary, capped at £25,000, are among the most popular options.
Learn more about Forces Help to Buy in Manchester.
If you are a council tenant looking to buy your property, a Right to Buy mortgage in Manchester can provide a discounted purchase price, potentially eliminating the need for a traditional deposit.
Another option to consider is a Lifetime ISA, where you can save up to £4,000 per year towards your deposit, with the government adding a 25% bonus of up to £1,000 per year. These options can greatly assist prospective home buyers in their journey towards homeownership.
For comprehensive information on the schemes mentioned above, as well as other specialised options, you can visit the official government Own Your Home website.
There, you can explore further details about these schemes and discover additional resources to assist you in your journey to homeownership.
If you prefer personalised guidance, reaching out to a reliable mortgage advisor in Manchester can be a valuable step towards starting your mortgage journey.
They can provide you with detailed information and help you in exploring the various options available, helping you take the necessary steps towards securing your own mortgage.
Pros and Cons of Equity Release in Manchester
Equity release has faced a lot of negative attention over the years, leaving many people in Manchester wary of considering it. Even though this is the case, much of this negativity stems from the way equity release was previously managed.
Thankfully, with the introduction of new regulations by the Financial Conduct Authority and standards set by the Equity Release Council, the public perception of equity release is improving, and more people are considering it as a viable option.
Despite this, there are still mixed opinions about equity release online, leading some to question whether it’s the right choice for them.
In this article, we aim to provide an in-depth look at the pros and cons of equity release in Manchester, so you can make an informed decision about whether it’s the right option for you.
What are the benefits of equity release in Manchester?
At Manchestermoneyman, we believe that taking out an equity release plan can offer many advantages for later life applicants. One of the biggest benefits is the ability to access the equity that has been sitting within your property.
Our equity release plan in Manchester is offered through a lifetime mortgage, with two options available: tax-free lump-sum or tax-free drawdown facility. With the lump-sum option, you receive a one-time pay-out in full. With the drawdown facility, you can withdraw equity as and when you need it.
When it comes to repayments, you have options. During the lifetime mortgage, you will have monthly interest payments, but you do not necessarily have to make them.
Many choose to let the interest roll-up, leaving them without monthly payments and more expendable cash. On the other hand, making payments can be beneficial if you wish to leave an inheritance for a family member.
You can also rest easy knowing that you are protected when you choose to work with us. In the past, equity release has had a negative stigma, but we have put safeguards in place to ensure that our later life customers are protected.
We are members of the Equity Release Council, which has product standards that provide additional consumer protection.
Another advantage of our equity release plan is that it can be a lifeline for interest only mortgage prisoners.
Many applicants in the 1990s and early 2000s may have taken out an interest only mortgage, but now find themselves unable to remortgage or access other options due to changing affordability checks.
With our equity release plan, you can pay off the final capital balance and take out a new mortgage, releasing the equity that has grown over time.
With a lifetime mortgage, you do not need to worry about a separate repayment vehicle, as the sale of your home will repay the balance either when you have died or moved into long-term care.
Additionally, with our no negative equity guarantee, you will not owe more than what you borrowed, providing peace of mind for you and your estate.
What are the downsides to equity release in Manchester?
As with any mortgage, there are also downsides to equity release in Manchester. One major negative aspect is that allowing the interest to roll-up can gradually reduce the equity in your property.
This means that when it comes time to sell your property, whether after your passing or moving into long-term care, there will be a higher balance to repay, leaving little or nothing for inheritance.
For many, leaving an inheritance is important, and this may be a deal-breaker for them. You may have the option to ring-fence a portion of your equity initially, although there may not be much left after this.
Moreover, as previously mentioned, it’s not always certain that you will pass away before your property is sold. You may need to move into long-term care, and if there is enough equity in your property and you have made interest payments, your care costs may be covered.
Unfortunately, if the interest has rolled-up and there are not enough funds from the property sale, it may not cover the costs of your required care.
Is equity release in Manchester a good idea?
Determining whether equity release in Manchester is the right option for you depends on your personal circumstances and goals. Unlike traditional mortgage lending, equity release can only be obtained through a later life mortgage broker in Manchester, after receiving equity release advice.
This is because while equity release can be a great option for some, it may not be suitable for everyone and can end up being a costly mistake. With the help of a later life mortgage advisor, your lifetime mortgage will be customised to your specific needs and plans.
Equity release in Manchester and lifetime mortgages are highly adaptable and can be tailored to meet your goals. Your mortgage advisor will also consider alternatives, such as conventional or unsecured lending, before discussing equity release as an option.
The Benefits of Equity Release Advice in Manchester
To determine which option, equity release or an alternative, is more suitable for you and your future plans, seeking expert equity release advice in Manchester from a qualified and professional later life mortgage advisor is recommended.
By examining your current situation, the advisor can provide the best possible guidance on how to proceed.
Taking out equity release advice in Manchester can help you avoid future pitfalls, as your later life mortgage advisor can plan around future decisions, such as ring-fencing inheritance, as previously discussed.
In addition, equity release advice in Manchester can be beneficial for younger borrowers. A later life mortgage advisor can examine holistic or phased entry into later life lending, and offer over 50’s mortgages.
These can include term interest only, retirement interest only, or other conventional mortgage options, for those who may not meet the age requirement for equity release in Manchester or are better suited for an alternative.
Your later life mortgage advisor prioritises your needs and will recommend the best option for achieving your goals while ensuring that you are secure and protected in the later stages of your life.
To understand the features and risks, ask for a personalised illustration.
A lifetime mortgage may impact the value of your estate and it could affect your entitlement to current and future means-tested benefits. The loan plus accrued interest will be repayable upon death or moving into long-term care.
Are Mortgage Rates Going Up in Manchester?
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!
