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.

The Pros & Cons of Using a Mortgage Broker in Manchester

It can be daunting taking that first step into the mortgage world for the first, second, or third time. With many options for first time buyers in Manchester, home movers and buy to let landlords’ to take for themselves, it is time and cost effective to get it right the first time.

Regardless of your mortgage goals and situation, we offer a tailored and friendly service to try and help you through your mortgage journey.

We understand the process can be complicated. Therefore, we have great confidence in our ability to help our customers through the mortgage process and provide expert mortgage advice in Manchester to new and existing customers.

In this article, we have collated an overview of the pros and cons of approaching a mortgage broker in Manchester which may help you, and why many people prefer coming to us for mortgage advice in Manchester. 

Why use a mortgage broker in Manchester?

Cost-Effectiveness

Many believe that by doing direct and finding your own mortgage deal, you are more likely to save money. This is not entirely the case, as most mortgage brokers in Manchester may charge a fee, however, this does base on circumstances and company you go towards.

It could be easier and more cost-effective if you have a lot of knowledge and have a simple case, but it can be more complex depending on your situation so approaching a mortgage broker in Manchester would be useful.

Not having much knowledge could result in ending up on the wrong deal or being unsuccessful on your mortgage application. Either of these conditions could end up you spending more money than you must or harming your credit score. Which can impact your chances of applying for a mortgage in the future.

With a dedicated mortgage advisor in Manchester by your side, they will aim to help you achieve your mortgage goals. Their goal is to get their recommendation right for the first time, at the best price. As much as this comes with a service fee, it could mean that you save much more money overall.

Local Bank Branch Relationship 

Loyalty can be one reason many customers approach the bank directly and how the mortgage process was previously run. This was the way before the rise of technology and online banking, in which loyal customers approached their local branch every day, usually talking to the same person.

In terms of the mortgage process, your best bet would have been to get the best person to approve a mortgage for you because you get help and guidance from the bank manager himself, who is an expert and has a thorough knowledge of your finances. Now, the process is significantly different with the credit scoring being digital.

Because of this, the bank manager will not physically go through the case themselves; it will go through a complex online system to see if you are eligible for a mortgage. Everything is fair regardless of which bank you are with.

Exclusive Mortgage Products 

Many believe that you are open to better, exclusive offers by going directly. Again, this is true, though, it can be limited. That is because they only offer their company the best deals.

Not all mortgage lenders are banks, and there are many more options available. Therefore, the deal that the bank considers suitable for you may not be the best deal beyond the bank you could have gone with.

Getting specialist mortgage advice in Manchester can be the best way to get a competitive deal that is suitable for you. One of our expert mortgage advisors in Manchester will be able to go through your case and find you the best deal from our large panel of lenders.

This is another advantage of approaching a mortgage broker in Manchester rather than just a bank.

After the topic of deals, you can find approaching a mortgage broker in Manchester can provide you with exclusive deals that you cannot find anywhere else. There will be a broad range of options when you are with a mortgage broker regardless of if you are a first time buyer, moving house, or looking to remortgage in Manchester.

Changes to Regulation & Consumer Protection  

In the wake of the 2007-08 credit crunch, a huge improvement in the mortgage market had to occur. One of these changes was stated in the 2014 Mortgage Market Review. Which instructed lenders without extensive expert advice to sell mortgages to their customers.

Because of this, people could not just approach a bank to tell them they wanted a mortgage and were promptly granted without checks. Not every employee in the bank could grant you a mortgage. Which was something that happened regularly regardless of whether they were qualified to do so or not.

As well as this, these changes also bought about consumer protection, which a bank would not have given you. Now, you can place a complaint with the Financial Ombudsman if you feel misadvised. Another way to make a claim is through the Financial Services Compensation Scheme.

This means reassuring a customer that they will be safe and advised accordingly regardless of their mortgage journey. This applies to mortgage brokers in Manchester and lenders.

Book an Appointment with a Mortgage Advisor in Manchester 

Another drawback you get approaching a bank instead of a mortgage broker in Manchester is the timing. When you approach a bank, it can take months to talk to someone in a bank. Moreover, when you start the process, you are not updated as much through the mortgage journey.

Here at Manchestermoneyman, our responsive team will contact you at a time that is best for you and your day to day life. From early to late, 7 days a week, including weekends, our mortgage advisors in Manchester will be available to answer any of your questions and keep you up to date. You might find us being contactable on some bank holidays.

In some cases, you may attend your appointment on the same day, but this should not be the case. You can talk to someone whenever you are ready and available.

We understand that the lifestyle of each customer is different. As a result, our advisors in Manchester are available throughout the day, which means you can book an appointment beyond 9-5 or even on weekends! Our online booking system is simple, where you can find a slot to speak to a mortgage advisor in Manchester.

Responsiveness is a fundamental value within our company. Whether you are at the beginning of the process or towards the completion of the mortgage, our friendly team will always keep you up to date. If there are changes, your mortgage advisor in Manchester will contact you as soon as possible.

Providing this high-quality service is why many mortgage brokers in Manchester, like us, are favoured in the public eye. With this popularity, many people prefer to approach local experts rather than national banks.

Handling of Complex Scenarios 

Thanks to our extensive industry experience, we have found that some cases are more difficult than others. Below are just some scenarios that are slightly more difficult than the usual case:

• Mixed Depsoit – This means auditing two different sources like a gifted deposit and money from savings. 
• Zero Hour Contract Workers – Will there be a consistent income? 
• Looking to Make a Second Purchase – Can they afford to make that additional purchase? 
• Self-Employed with No Fixed Income – This can be challenging for anyone who is self employed in Manchester. 
• Poor Credit History – A lender will not look favourably upon an applicant who has mismanaged in the past. 
• Affordability – Can they afford a mortgage full stop? 

Previously, mortgage lenders could easily compete by offering better deals than the others. Now, the main change in which deal you go with is if you match the criteria.

You can find a cheaper deal, but it may not meet your criteria. To see if you can have a mortgage, the mortgage lender carries out a hard search (resulting in a footprint on your credit file).

In the case where you apply for the mortgage with a lender and refuse a deal in principle, this could harm your credit file. The most frustrating thing about all this is that it is very unlikely that you will be given a reason you have been rejected.

Agreement in Principle

Mortgage brokers in Manchester will be able to go through your case and advise you on ways to increase your chances of being accepted. With access to a wide range of lenders, they can find you the most suitable deal that perfectly matches you with its criteria and then start getting an agreement sorted for you in principle.

If you get an agreement in principle through Manchestermoneyman, it will usually be sorted for you within 24 hours of your free mortgage appointment.

Keep in mind that this doesn’t automatically mean you agree or guarantee a mortgage at the end. However, it makes your credit file much safer by having an expert go through it in advance. Our team of Mortgage Advisors in Manchester will always aim at getting our recommendation right the first time.

Should I use a Mortgage Broker in Manchester? 

There are pros and cons of approaching a mortgage broker in Manchester. On the hand, there are many pros and cons to going direct too. The difference is how fast you want your service to be, as well as how safe you want to be.

As a dedicated mortgage broker in Manchester, we have extensive experience in dealing with a wide range of clients who go through the mortgage journey. Whether you are a first time buyer in Manchester taking that first step into the mortgage world. Somebody who is coming towards the end of their fixed period, or looking to remortgage in Manchester, our team are more than happy to help!

Book yourself in for a free mortgage appointment or remortgage review to speak with an expert mortgage advisor in Manchester. Our team is here to help with your mortgage goals, with availability that suits you, subject to availability.

For more information about our service, check out our brilliant customer reviews. These show the high level of service we give our happy customers daily. We also have a YouTube channel MoneymanTV if you are looking for more insight into the mortgage world. 

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.

A Guide to Offset Mortgages in Manchester

Offset Mortgage Advice in Manchester

The general popularity surrounding Offset Mortgages has dipped since their rise during the 1990s, though some of you may be pleased to know that they are still a great option for customers who have the ability to put some money aside every month.

They’re also quite good if you believe that you are due to receive a lump sum in the near future.

How can an Offset Mortgage help?

When you start out with your Offset Mortgage, you will be given a savings account by the mortgage lender that will run alongside your mortgage, for the sole purpose of aiding your mortgage. Rather than racking up interest, the money will offset against the balance of your mortgage.

As an example of how this works, let’s say that your mortgage is worth £100,000 and you have managed to save up £15,000 in savings, then you will only be paying interest on the £85,000 that is left.

Offset Mortgages tend to be rather flexible arrangements. Until you have completely offset your mortgage, you will have the ability to put as much money as you would like into it. You will always have instant access to the money that is in your savings, so if you need to dip in for any emergencies, you know that it is there.

One of the things that is really great about Offset Mortgages, is that it saves interest, as opposed to adding it on, so you won’t have to pay any tax on any savings that you put into your savings. Higher rate taxpayers are definitely big fans of these!

Things You Need to Know

An Offset Mortgage is a great option if you are due a lump sum for any reason, such as possible inheritance, as because it is interest-free, it allows you to store your money until you know what you want to do with it. This also applies to any annual or quarterly bonuses from your job that you have no dependance on.

Because your savings account will be freely accessible at any time, you are able to dip into your additional savings for other means if you need to, whilst leaving some in there for your mortgage. It is important to remember that you need a substantial amount in there though to make your Offset worth taking out!

An Offset Mortgage can work out really well for First-Time Buyers in Manchester who have any plans to overpay on their mortgage. Looking further down the road, once your current term ends, overpaying can potentially reduce your mortgage payments for the next term that you take, reducing interest rates in the process.

With other mortgage types, any money that you put towards your mortgage cannot be withdrawn at any point, with releasing equity being your option once your term has ended. This is a situation that is less than ideal if you have any second thoughts or need a short term boost to your income.

It’s times like this where Offset Mortgages are rather clever. Because you have a savings account, you will have the ability to take out the funds at any time, then put them back in when you are ready to do so.

So, if you’re looking to make any further payments on your mortgage over the term, we’d recommend making use of an Offset Mortgage savings account.

Conclusion

You should consider all of the options that are available to you when you get in touch with a Mortgage Advisor in Manchester.

Some consumers who like using Offset Mortgages tend to keep going with them and are less likely to Remortgage than another homeowner might be inclined to. The may seem a little complex though, so there are customers who may not use this option.

Your dedicated mortgage advisor will be able to show you the impact of how an Offset Mortgage can potentially save you money over the course of the full mortgage term.

If you have any further questions relating to the topic of Offset Mortgages or a Remortgage in Manchester, feel free to book online for your free mortgage appointment and we’ll happily talk you through whatever you need help with.

Sole Name Mortgage Advice for a Married Applicant in Manchester

Mortgage Advice in Manchester

When you start applying for a mortgage, we usually find that the vast majority of applicants in relationships will opt for a joint mortgage instead of applying for a mortgage in one of the couples’ sole names.

With property prices continually fluctuating ahead of wage increases, lenders prefer first time buyers in Manchester to have two incomes, rather than both of them living there, and only one person is liable for the mortgage. 

Sometimes there are situations where it’s acceptable for a sole name to apply for a mortgage. Be that it’s a personal choice or down to circumstances, it can be anything from one of the applicants not keen to have their name on the mortgage to a financial issue that cropped up.

Financial issues could be bankruptcy to county court judgment, factors like these that could affect the other applicant, and their chances of obtaining a mortgage. In situations like these, it’s much better than having no tied finances, and only one applicant applies for the mortgage in their name.

It’s worth noting that if one half of a couple gets into trouble financially, it can significantly harm the other half attempts to apply for credit, especially something as significant as a mortgage loan.

Mortgage Application Borrowing Capacity

The maximum borrowing capacity for a couple with only one applicant in employment will be lower than it would’ve been if the applicant who is employed had applied in their sole name.

Age is another factor that can affect the maximum amount you can borrow. For example, if you are over 50 and plan to take out a mortgage with a younger partner with a higher paid job, they have more time to pay off the mortgage. It’s then best to apply in their sole name, as they may have access to a much higher mortgage amount.

Implications on Tax

The effects of stamp duty or something else relating to tax may be a potential reason a couple may choose only to have one of them apply for the mortgage in their name rather than as a couple.

Speak to a Dedicated Mortgage Advisor in Manchester

You’ll find that there are many lenders with strict criteria regarding married mortgage applicants, as it is a mortgage that will involve two people who are connected firmly. Whilst applying under a joint name gives the lender security, it can have its problems.

The main reason is that if you happen to get divorced, it’s a complex process trying to remove one of your names from the property. Our team of mortgage advisors in Manchester can help with this, but you should give plenty of thought before jumping in headfirst with your partner.

Here at Manchestermoneyman, we have Specialist Mortgage Advisors in Manchester available 7 days a week to help you find the most suitable mortgage for your circumstances.

We are proud of the level of service we can provide home buyers and homeowners alike, so please do book yourself in for a free mortgage appointment, and we’ll see how we can help!

Plan Ahead to get a Mortgage in Manchester

Fast & Friendly Mortgage Broker in Manchester

Buying a home isn’t something that you decide in a day, there is planning that comes with it. Nevertheless, you’d be surprised at the number of people we have encountered on a daily basis who are more impulsive in their buying behaviour. By doing this, many people don’t plan for a mortgage ahead of time.

A First Time Buyer in Manchester might decide to jump into such a big financial commitment like purchasing a property if they are buying from a family member who is now moving home. Another reason might be as simple as finding a property with a ‘For Sale’ sign that has piqued their interest despite having no intention of buying in the past. You might already have your own rented property and your landlord is deciding to sell it and giving you first refusal.

The issues with not planning for a mortgage

Potential errors can occur because buyers have not planned in advance for a mortgage. Below are just a few hurdles we find customers are regularly faced with:

• Not enough time to save money which means less deposit
  
• Not seeing your credit score as important in the past leading to having a poor credit score
  
• Conducting your bank account poorly
  
• Your lastest accounts not looking their best as a self employed applicant

Deposits

When it comes to saving up your deposit for a mortgage, we understand that it can be challenging, in particular, if you are renting at the moment from a local council or private landlord. Large outgoings and essential purchases coming out each month can limit what you save, even if you have a constant income.

With the help of Gifted Deposit, family members have the chance to provide financial support. This can be a common option with First Time Buyers in Manchester, with a large number of buyers’ family members trying to help whenever they can. If this is something you are looking to do, it’s best to give the family member who’s gifting the deposit some notice in order for them to get their own finances sorted.

Credit Rating

Obtaining an up to date credit report is pretty simple. There is a range of credit reference agencies that you may be aware of, however, we personally would recommend Check My File. This is because they have the ability to collate the data from these sources into one, for you to compare.

When you have a copy of your report, you can send it to a Mortgage Advisor in Manchester to look over. Our team see these reports on a daily basis and have a good understanding of the sort of things lenders like to see, as well as identifying what they do not want to see.

Bank Accounts

Lenders look at your bank account to identify any unnecessary bank charges or gambling transactions. If you do have any on your statements, you need a good explanation of the goings-on with your account, as well as how you are going to resolve this going forward, should any issues arise again.

Self Employed

When it comes to self-employed applicants, we know that Accountants try to minimise tax liability for their customers. With this in mind, if your year-end has come around, then you can submit another set of accounts earlier than you might usually do. This can be beneficial if you feel your business has grown in the last 12 months. In some cases, lenders might disregard the initial years’ figures if the up to date ones are more favourable.

Regardless of your circumstances, if you feel your situation applies to any of the issues above, we are able to help. Here at Manchestermoneyman, we love a challenge, so don’t hesitate to Get In Touch!

What is a Gifted Deposit in Manchester?

First Time Buyer Mortgage Advice in Manchester

When you are looking at buying your first ever home, it can be challenging trying to figure out the cost of everything. From the cost of the property, mortgage arrangement fees and deposit size, to name but a few, there’s a lot to consider.

The latter is the primary focus of our topic here. For any purchase and subsequent mortgage, you will need to put down a deposit on the property. Be it a gifted deposit, your savings or a Help to Buy Scheme, there are many different ways to make up that deposit.

You can use any of the methods to achieve this, so long as you are able to evidence where that deposit came from, as though it will only be a portion of the much larger property purchase price, it will still be a considerable amount of money being put down.

We find that gifted deposits are typically the most popular forms of deposit for a first time buyer in Manchester. If you’re buying a property for the first time, this may be crucial in helping you to own your own home.

Gifted Deposit Mortgage Advice in Manchester

What is a gifted deposit?

A gifted deposit is a lump sum of funds that is given to you as a gift, allowing you to cover all of or make up some of your mortgage deposit. Gifted deposits are not loans, they’re strictly gifts that will not be repaid at a later date.

Your donors will need to sign an agreement confirming that this is to be the case, before you can proceed.

How can gifted deposits help?

Gifted deposits are useful when you’re struggling to save up for the deposit on your mortgage. You may be able to afford the monthly repayments with your income, but saving up a bulk of income for a deposit can be quite tricky.

If you receive a gifted deposit from somebody, combining it with some of your savings can help to raise your deposit even further, possibly allowing you to gain much better interest rates.

This minimum required deposit is typically around 5%, though some lenders may want to see 10-15%. If this has been gifted and you can make up a further 5% of your own, you could be going to the mortgage lender with a 15-20% deposit, which would be incredibly beneficial.

Lower interest rates are useful if you happen to be working on a lower salary.

Who can gift the deposit?

Generally speaking it will be the mortgage applicant’s parents that gift the deposit. This can be both birth and adopted parents, as well as carers and legal guardians in some cases. You will also sometimes find that friends can also gift this.

Depending on the mortgage lender that you are applying for a mortgage with, there may be some limitations to who can and who can’t gift you the deposit for purchasing a property.

If you already know who is gifting you the deposit prior to making any applications, it is worth speaking with a qualified mortgage broker in Manchester. They will be able to match up your circumstances with an appropriate mortgage lender and product.

Do your parents know you need help?

As a team of expert mortgage advisors in Manchester, we regularly find that not only are applicants hardly aware that a gifted deposit is an option, they don’t consider that their parents may actually be able to help.

Contrary to what you may believe, we find that most parents are more than willing to help their children finally get onto the property ladder and become a homeowner. It certainly doesn’t hurt to ask!

Many consider the concept of taking out a mortgage to be much better than renting a property, as you could be paying much less per month than you would be paying to a landlord.

A gifted deposit can sometimes come from inheritance, though this isn’t always later in life. Parents have been known to gift much earlier on in life if they already have enough in savings or have done equity release in Manchester.

Gifted Deposit vs Loans

Most mortgage lenders will dislike the idea of accepting loans as your deposit, as you’re essentially paying off two sets of large loans and are borrowing 100% of your mortgage.

You won’t be paying off your gifted deposit as this will only be a gift to you and you will not owe anyone any money, as per the agreement signed by your donor.

Is there a maximum or minimum gifted amount?

There is no limit to the amount that you are able to receive as a gifted deposit. We see that most people gift between the 3-5% mark, sometimes more.

Who can benefit from a gifted deposit?

If you are a first time buyer in Manchester or moving home in Manchester, a gifted deposit will be of a great benefit to you during your home buying process.

It can also be useful when in conjunction with a Help to Buy in Manchester, as the required 5% deposit, depending on the lender, can also be paid via gifted deposit!

What proof is required?

You will need to provide an audit trail of where you got your gifted deposit from and where the person who gifted it to you built up the funds from.

Proving your gifted deposit is also much easier if you leave the proceeding within the gifter’s account, as later into your application process, your mortgage advisor in Manchester will help you evidence this as a gifted deposit.