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.
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.
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.
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.
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.
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.
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:
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.
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.
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.
Depending on the situation, a second mortgage is a possible option for you to take up. Here Malcolm has compiled a video to talk to you about the significance of taking out a second mortgage in Manchester.
There are many situations that require a person to have more than one mortgage. We created a list based on a few popular situations our mortgage advisors in Manchester have encountered, as to why two mortgages may be important:
1) Do you want a second mortgage to raise money for your existing home
2) Are you looking to rent out your existing home and purchase a new one
3) Your name on an existing mortgage and you are looking to buy a new property?
4) Are you looking to help your children out with a second mortgage?
5) Do you require a second mortgage to purchase a buy to let property
We have in-depth knowledge of Buy to Let mortgage criteria and worked with many lenders including some specialist ones, all with various lending criteria, for more information check out our Buy to Let Mortgage Advice in Manchester page.
If you have equity in your home and are looking for a second mortgage to release some of this to fund a purchase or anything else, then our team of expert mortgage advisors in Manchester can help. A second mortgage for this purpose is also referred to as a secured loan.
This situation is known as a further advance. A further advance is when you borrow more from your current lender to fund something like home improvements or a second mortgage.
Quite often if you are on a lenders standard variable rate, we are able to shop around and find a more competitive deal at the same time as releasing capital. A further advance with your current Lender is also an option.
Whether you are looking to move to a new house but keep hold of your existing property with the view to let it out we will be able to help. Your second mortgage will be a new residential one. This kind of move is known as a let to buy and has become increasingly popular in recent years.
If you are exploring the options that are available to you, for helping your children or grandchildren with getting on the property ladder there are now many products that our mortgage advisors in Manchester can run through to help you get a step nearer to accomplish this.
If you are looking to purchase a buy to let our team are able to utilise our experience and knowledge to recommend the most suitable Buy to Let mortgage product based on your individual situation. You will be asked to produce a higher deposit for this than a residential mortgage.
Are you currently named on another mortgage and would like to purchase a new property to live in? This is a situation that our team comes across on a regular basis especially due to divorce or separation and can often help.
Whatever your situation is to get a second mortgage, being an experienced Mortgage Broker in Manchester our Advisors are able to search thousands of mortgage deals on your behalf and recommend the most suitable product for you based on your individual situation.
For more information contact us to book your free mortgage consultation, and speak with one of our expert mortgage advisors in Manchester today.
No matter, if you are a First Time Buyer in Manchester or looking to Remortgage in Manchester. Getting mortgage advice in Manchester can help you. Taking mortgage advice can make up the difference between an application getting accepted.
Whereas going independent could lead to your application getting rejected. We’ll search through thousands of mortgage deals for you. Saving you time and your money to ensure you get the best deal.
It’s a mortgage advisors job to find you the most suitable mortgage deal tailored for your circumstances. Some say that there’s no significant difference between an advisor and a broker.
However, here at Manchestermoneyman. We can tell you our team of specialist mortgage advisors in Manchester is authorised and regulated by the Financial Conduct Authority.
This means we have experience and in-depth knowledge of lending criteria. Offering expert advice to clients with all types of individual situations.
Maybe you are first-time buyers who want to get there foot onto the property ladder, and the process can be confusing.
However that’s where we come in our teams of mortgage advisors can walk you through every step, from initial mortgage enquiries. Right until you get the keys.
Perhaps you need mortgage advice because you are looking to remortgage for home improvements, purchasing your next property. Especially if you want to borrow additional money.
Finally, our team of specialist mortgage advisors in Manchester. Can help find suitable mortgages for a landlord looking at Buy to Let in Manchester.
The advantages of using a Mortgage Broker in Manchester. Is to help the entire process of buying a home go as efficiently as possible. Buying a home can be an extremely stressful experience.
Our customers like to know they have got someone on their side. On hand to respond to all their questions and queries, we will also help you with:
Our mortgage advisors in Manchester job is to help try to maximise your chance of being accepted the first time.
Open & honest Mortgage Advice in Manchester by Manchestermoneyman, 8am – 10 pm, seven days a week. As an experienced Mortgage Advisor in Manchester.
We are proud to have the quality of service we provide to our customers. We put our people at the heart of our business and always aim to exceed their expectations. Get in touch with your Mortgage Broker in Manchester today and receive a free mortgage consultation.
On Saturday 31st October, the UK Prime Minister Boris Johnson announced that England would enter a second lockdown from Thursday 5th November, through until Wednesday 2nd December. This was done with the intention to decrease the spread of the coronavirus across the country, with additional restrictions in place.
Luckily for some, this lockdown is a little more relaxed than the first lockdown we experienced, allowing more industries and educational settings to remain open. The thing that initially concerned us the most, was what would happen to the property market. Thankfully, now that Lockdown 2.0 is underway, we can say that everything looks promising and the property market will remains open as normal.
Of course, there has been some minor changes to areas of the home buying process, most of them relating to social distancing. The property market is still standing strong though! Here is a look at some of the things you can still do:
Lately we have received lots of mortgage questions from First Time Buyers and Home Movers in Manchester about the current national lockdown and how it affects the property market:
Unlike the start of the last lockdown when the rules were stricter, in this lockdown you are still able to move home if you need to. Home removal services, van hire, everything needed to move home will still be available for people to use.
As mentioned at the start, the process of moving home will have to be completed under the social distancing guidelines. This will be vital to follow if you are either viewing other people’s properties or taking house viewings on a regular basis.
Yes, the government are allowing you to visit your estate agent’s office. However, this is dependent on individual branches, as some estate agents have chosen to work form home and have closed their public office. You may have to check online to see whether they are open or not.
Nowadays a lot of people prefer to transact over the phone, so even if you can’t visit in person, you can rest assured that the staff are fully equipped to get the process started over the phone and even online.
We advise that you take your time if you are going through the process online, and make sure that you fully understand everything that is being communicated.
You can still continue with your house viewings, however, if your estate agent is offering a virtual house viewing, it is probably more recommended to try that. Most home buyers are shifting towards this new way of doing house viewings; as a Mortgage Broker in Manchester, we also expect that the number of virtual viewings will increase over the course of national lockdown.
Even though virtual viewings may be your safest option, we also understand that choosing your dream home is a really big decision for your life going, so if you want to view the property in person, this is understandable. Just remember to be careful!
Your estate agents will also check with the property owners that a property viewing is okay, so long as it is socially distanced property viewing. If they agree, then you can arrange a date and time. Depending on the time of day and the homeowner’s personal situation, they may go out somewhere so that there as few people in the household at one time as possible.
The property market hasn’t been put on pause like it was earlier in 2020, so you are still able to go through the home selling process as normal. You will need to consider everything that comes with selling a property, including choosing an estate agent and a property valuation, getting pictures of the property taken and making it presentable for any viewers.
With the guidelines and restrictions in place, there may be some delay in certain areas of the process, though that should not put you off. Estate agents are very busy right now with enquiries and with all of the different measures in place, things that are normally easy to complete are taking a little longer than they would like.
Yes, conveyancing solicitors will remain open as normal. They will still be available to support the sale of your property. Much like estate agents, most solicitors are working from home and we advise that you be patient as due to the demand in the property market, things may not go as quickly as you’d normally hope for.
As a dedicated Mortgage Broker in Manchester, this is a question that we have been asked quite a lot during the course of the pandemic. It was particularly asked by lots of homeowners during the first UK lockdown.
In this lockdown, even though it’s much shorter, you can take a mortgage payment holiday if it is really deemed necessary. We understand that there are many homeowners out there that need help meeting their mortgage payments. If this is your situation then taking one out could be a real lifeline for you and your home.
To find out more helpful information about mortgage payment holidays and whether you should take one out, check out our article on mortgage payment holidays.
If you took out a mortgage payment holiday during the first lockdown and are currently still on the scheme, you can extend your holiday further so that it comes to a total of six months holiday. However, if you have already had a six month payment holiday and you have already reached the six month limit and therefore unlikely that you will be able to utilise the scheme again going forward.
The property market is slowly catching up to speed and thankfully can continue marching on through this second lockdown. If you are wanting to start the mortgage/home buying process and would like help from someone with experience, it may be within your best interests to get professional Mortgage Advice in Manchester.
With all of the social distancing measures in place and the demand in the market, this could also make things a lot quicker for you. As an experienced Mortgage Broker in Manchester, we have a wealth of knowledge in helping customers achieve their mortgage dreams. We want the whole process to run as smoothly as your do; don’t hesitate to get in touch today and we will get you booked in with a mortgage advisor!
The mortgage journey is truly an adventure to behold. Though you will face your fair share of both highs and lows, in the end you will end up with one of the following: either the property of your dreams to settle down in and maybe start a family, a stepping stone property to help you find your footing on the property ladder or an investment purchase to provide some additional income.
No matter the path you ventured down, there will eventually come a time when your mortgage term is reaching its end. You have the option to sell up and upsize/downsize into a new property.
Maybe you are in the market for selling your portfolio to the tenant(s) or another buyer and look at other financial opportunities? The most popular option however, over all of the above, is a Remortgage.
First, let’s look at the definition. A Remortgage is a process of using the funding from a new mortgage to pay off a pre-existing mortgage. There are lots of different options when taking out a Remortgage, ranging from minor to major.
By taking advantage of the 20 years or so knowledge of our resident “Moneyman” Malcolm Davidson (host of our YouTube channel MoneymanTV), we thought it would be beneficial to everyone, if we put together a quick guide to all the options at your disposal when it comes to taking out a Remortgage.
Your initial mortgage deal will normally last somewhere between 2-5 years and feature low fixed rates or possibly discounted rates. In some cases, your lender may even place you on a tracker mortgage, which follows the Bank of England’s base rate.
When your mortgage term comes to an end you will likely be placed on the lenders Standard Variable Rate (you may see this referred to simply as SVR). The purpose of an SVR, is that it is a mortgage with an interest rate that can possibly move up or down, depending on what the lender wishes to charge you.
This does not follow the Bank of England’s base rate like a tracker mortgage and as such can be a little more risky, as the lender is not legally obligated to charge the recommended amount.
Because of this, SVR’s are usually the most expensive paths to take, leaving many to look at Remortgaging for better rates, which will hopefully save a little bit of money on monthly repayments.
After your 2-5 year term into occupying your home, you may decide that something doesn’t quite fit. Maybe you need an extra room or larger living space for your kids or belongings, a new kitchen, a new office, or a loft conversion.
Instead of just moving into a larger house, many seek to release their equity with a Remortgage in order to cover the costs of any work needed or wanted.
Though the idea of having to obtain planning permission and fund/manage your own project seems scary, some would argue it’s a lot less stressful and more rewarding than the process of property hunting, selling your current home and moving your possessions.
As time passes by, this may prove even more to be a wiser option, as creating more space and having good quality craftsmanship will likely increase the value of your home. This comes in handy for if you ever do decide to sell up or rent out.
In some cases, some homeowners may wish to Remortgage in Manchester for a better mortgage term, whether that be by reducing the length or switching to a more flexible product.
Doing this will mean you won’t be paying back your mortgage for as long, so you won’t be tied down for the rest of your life. However, this route will also mean that your monthly repayments will be a lot higher. The longer your term, the lower the payments will be over time.
Some opt for their mortgage term to be a little more flexible when they remortgage. The benefits provided by this option can often sway homeowners in its favour.
You may gain the ability to overpay, resulting in being able to pay your mortgage off quickly, as well as being able to carry the same mortgage and rates over to another property of your choosing, should you decide to move later down the line.
Though a flexible mortgage sounds like the ideal situation, they usually come in the form of a tracker mortgage, which as discussed in an earlier point, follows the Bank of England base rate. This means your payments could fluctuate based on interest, making them a little unreliable each month.
Everyone has some variance of equity in their property. This is worked out with the difference between what is still owed on the mortgage and the current value of your property.
As touched upon earlier in this article, equity can be used for home improvements, however there are more options available with this.
Some use it to cover long-term care costs, to add to their income, to have a holiday, to pay off an interest-only mortgage or to simply have free money to spend on whatever they would like.
In some cases, we find that Buy-to-Let landlords will use a remortgage to release equity as a means of covering their deposit for purchasing further additions to their property portfolio.
If you’re over the age of 55, and currently living in a property with a minimum value of £70,000, then it’s worth exploring your options for Equity Release in Manchester. To find out if you qualify for later life lending, book your free mortgage appointment to speak to a later life mortgage advisor in Manchester.
To understand the features and risks of equity release in Manchester, 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.
Another big one people use a remortgage to release equity for, is to pay off any unsecured debts that may have built up over a particular length of time.
Though it may seem easy enough, Debt Consolidation not only bases the amount on how much you’re owed and the value of the property, but it also factors in your credit rating. This could mean you are limited in the amount you can borrow for a property.
Additionally, to pay off your previous mortgage and your debts, you will need to borrow more than the mortgage amount you have left. This means your monthly repayments will most likely be higher than expected. Though not a perfect circumstance to find yourself in, at least you can rest assured that should you find yourself in need of a way out, you do have some options to choose from.
Should you find yourself with a damaged credit rating, you do still have a chance to obtain a mortgage, though these will not be easy and require very Specialist Remortgage Advice in Manchester before even proceeding. Even then, there is no guarantee that it can even happen.
You should always seek mortgage advice before choosing to consolidate and secure any debts against your property.
If you are reaching the end of your term and are looking at what your option may be for Remortgaging, it will be beneficial for you to Get in Touch with an experienced and trusted mortgage broker in Manchester.
An advisor will be able to discuss your circumstances and future plans, in order to create the best plan of action for you in the next step of your mortgage adventure. It is our aim to ensure this go around is a quicker and easier process than when you took out your initial mortgage.
The general rule of thumb, whether a first-time buyer, home mover, or budding Buy to Let landlord in Manchester, is the higher your score, the more likely you are to get accepted for a mortgage.
It is worth noting that lenders have an internal credit score that gets built on the information held on your credit report as well as information within your application. Every mortgage provider follows their credit scoring policy, so just because one high street bank declines you, it doesn’t necessarily follow that they will all say no.
When it comes to which credit reference agency to use, or which one will the lender use, unfortunately, they do not always divulge this information.
In any case, sometimes lenders chop and change between Experian, Equifax, and Call Credit. It is good practice when looking to obtain a mortgage to check multiple credit reference agencies. The reason for this is that information on one agency’s file may differ from that on another.
Until you have registered with one of the credit reference agencies to check your score, the first thing you need to do is stop applying for new items of credit. Be careful, something as simple as comparing car insurance on a price comparison website can register unwanted credit searches.
Lenders will use the electoral roll to carry out identity checks, so this is a crucial step. Ensure that your names spelled correctly and you get registered at your current address, your credit file will show if you are registered or not, you can also check with your council.
Mortgage Lenders like to see some “active credit” so having a credit card that you use regularly and pay it off in full each month can help over time. However, bear in mind that taking out new credit could have a short-term negative impact. Don’t miss payments!
Regularly running close to your limit on your credit card or going over the limit will harm your score. Using too much of your available credit will hurt your credit score.
It is essential that you do not appear to be living in two places at once. In any case, this can happen when you incorrectly enter your dates in and dates out of previous addresses.
It’s worth spending some time double-checking the dates and making sure the formats of the addresses are consistent. However, this is tricky when you have lived in a flat/apartment.
If you have any credit or store cards that you are not using you should cancel these. Please note again that this could have a short-term negative impact on your score.
The systems can’t tell whether it is you or the lender taking this action, but it helps in the long run. Also reduces the chances you’ll fall victim to fraud if they were ever to get stolen.
Ensure that all of your open accounts get registered at your current address and not a previous one.
Your ex-partners could affect yours if you hold joint accounts, a mortgage, or a loan. It is vital to inform the credit reference agencies that you are no longer associated and remove any links.
Love it or hate it credit scoring is here to stay. Also, it will have a significant bearing on whether you will qualify for the mortgage you need. It’s quicker and more consistent for lenders to rely on their systems than their human resources.
Having an up to date copy of your credit report to provide to your mortgage broker will help build up a full picture of your financial situation and help them recommend the most suitable mortgage for your circumstances.
The effects of the coronavirus have heavily hit the mortgage market and it’s still recovering. The whole economy has been affected; The impact has impacted everyone differently in some way or another.
At the moment, lenders are only offering 90% mortgages (10% deposit), which can prove quite expensive, particularly to First Time Buyers in Manchester looking to purchase a property in Manchester.
There are ways, to get onto the property ladder with a 5% deposit. With our help, we thought that it would be within your best interests to explain to you how this can get achieved using the Help to Buy in Manchester or looking into Shared Ownership:
The Shared Ownership scheme can also benefit you get onto the property ladder with a 5% deposit. This scheme lets you purchase a percentage of your mortgage and then pay the rest on rent.
Additionally, this percentage usually is anywhere between 25%-75%. As you only own part of the property, you share the property with the government.
Like the Help to Buy Scheme, you have to qualify for the Shared Ownership scheme and meet specific requirements. Here we listed the rules that you will need to adhere to qualify:
If you are struggling to obtain a standard mortgage, the Shared Ownership Scheme could be your best option. If you want Shared Ownership Mortgage Advice in Manchester, you should approach a Mortgage Broker.
They will tell you everything about the scheme and see if you qualify for it. Talking to a Mortgage Broker in Manchester could say to you exactly what you need.
Even though your options may be limited when trying to get a mortgage with a 5% deposit, these two schemes could be great options to consider. Both methods are still holding their weight in the mortgage market.
Whether it’s a Help to Buy Scheme or the Shared Ownership scheme, we can help with both.
Firstly we will check if you qualify for a scheme and whether it will suit your personal and financial circumstances or not. If everything looks good, we can get your mortgage journey started.
Getting Mortgage Advice in Manchester could be within your best interests, especially in this day and age.
The mortgage market is up in the air at the moment, so getting advice will be extremely beneficial, especially if you are a First Time Buyer in Manchester. Feel free to get in touch so we can discuss your mortgage options.
When Buy to Let customers with an existing property portfolio in Manchester get in touch, we often hear the following question: Am I able to exchange ownership of my property from my own name, into the name of my limited company?
A good starting point is to know how a mortgage lender will approach purchases from Limited Companies. You will be hard pressed to find any lenders that will accept applications from a Limited Company through anything other than an SPV (Special Purpose Vehicle) Company.
An example of this is a company set up with the sole intention of investing in properties like this. When registering your company, your registration will include a SIC (Standard Industrial Classification) Code that shows the types of business in which the company will be involved with. Mortgage lenders normally would not accept applications from general trading companies that can trade in multiple areas.
If, for example, you have a plumbing and heating company (covering both trades), you will need to set up an entirely new company to own the properties in your Buy-to-Let portfolio, rather than buy them through your plumbing company. The SIC codes typically accepted are 68100, 68201, 68209, 68320, though this is varied depending on the lender you go with.
To find out more information about SIC Codes, consult the Government website: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/527619/SIC07_CH_condensed_list_en.csv/preview
You will find yourself with both advantages and disadvantages to purchasing a Buy-to-Let in Manchester under a Limited Company. For example, applications from SPV’s may not be considered by all lenders. Instead, they would rather limit their lending to lone applicants or couples who are applying in their own personal name(s) as opposed to a company name. Because of this, applicants using their own personal name will find themselves with a wider range of products than those using SPV’s.
When it comes to the lenders who would lend to an SPV, the mortgage rates are also generally much higher than the rates offered to individual applicants. An upside however, is that the way rental income is taxed has been changed over the past few years, meaning that many people prefer to make use of the advantages generated by SPV ownership (relating to how income is taken and how that income is taxed), as they more than make up for any extra interest charges or lack of choice when it comes to products.
One of the primary things we always suggest our customers look at when evaluating their options of buying your portfolio under an SPV, is that you speak with a specialist tax advisor for professional advice. A tax advisor will be able to assess factors such as external income sources and the rate of personal income tax you pay, seeing how they will affect the overall status of your tax. This will help decide whether or not individual or SPV ownership is an option you should go with.
As mentioned previously, a main deciding factor in your decision will be the position of your tax. This becomes a little more complicated when you start to weigh in whether or not you want to transfer properties you already own from individual ownership, to company ownership.
The issue is that it isn’t just a simple, straight-forward transfer. This type of transaction is a change of legal ownership. Your Limited Company is in it’s own right, a completely separate corporate identity. As such, the transaction will be counted as a purchase from you as the individual, to the SPV. With this in mind, stamp duty charges, legal costs and new mortgage and valuation charges will all be in play once again.
You must remember that Limited Companies come with running expenses and legal obligation, however, these may be offset by the possibility of tax-deductible costs or long-term tax benefits.
If a buy-to-let landlord is looking to increase their property portfolio, it would probably benefit them more to keep the current property under their individual name and only use the SPV to buy any additional properties. By doing this, you avoid any switching costs and unwanted legal fees for something that is already yours. That being said, each case is different, and you may find that the upside of a switch is far more beneficial than any of the downsides that come with it. It’s all depending on individual circumstance.
As covered, this is very specific territory. If you are thinking of following this path, please get in touch with an experienced and knowledgeable Buy-to-Let Mortgage Broker in Manchester.
Here at Manchestermoneyman, we have many Buy-to-Let experts on hand to provide a high standard of mortgage advice in Manchester, backed up by introductions to appropriately experienced accountants and solicitors as and when necessary.
To speak with a Mortgage Advisor in Manchester, please Get in Touch and we will see what we can do for you.
It is a no brainer why we think when going with a Mortgage Broker is beneficial and speaking to one of our Mortgage Advisors in Manchester, then going straight to a Mortgage Lender—saying that it’s still worth exploring your options. We find that most people use a Mortgage Broker in Manchester; however, in this article, we will explain the pros and cons of both paths.
A Mortgage Broker like us will likely charge a broker fee on top of the other costs, whereas the Mortgage Lenders do not require this payment, thus saving you money on that front.
The Lender offers exclusive direct deals. They do this to attract business from both consumers and brokers alike. In any case, these deals are sometimes available only via the Mortgage Broker and not the branch. Before 2014, your Mortgage Lender would be allowed to let any member of staff sway you towards a potential mortgage without any proper mortgage advice or consumer protection.
By 2014 this was thankfully banned, with only experienced Mortgage Advisors in Manchester allowed to provide Mortgage Advice and make recommendations for their products. However, this, of course, took some adjusting and customers could be left waiting for a month or maybe more, just for an initial appointment.
We still see today that sometimes this can always happen, which isn’t great when you’ve just had an offer accepted for a property. Because of issues like this, applications via Mortgage Brokers started to rise. We offer a same day service, aiming to put you through to a qualified Mortgage Advisor in Manchester either immediately or at the most within the same day.
Before the 2010s, it was much more challenging to compare possible mortgage deals. Fast forward to the present day and looking for such deals is significantly more comfortable, with everything just a Google search away. The difficulty now lies in finding a lender whose criteria and features can be personalised, based on your circumstances. It would help if you were wary though, that the deals with the lowest rates tend to carry high arrangement fees.
Another point to take note of its affordability. No matter how good a Lenders deal is, you must be able to afford it. Because this is such a big deal, many people choose to go with a Mortgage Broker in Manchester as we’ll compare the criteria and find something that matches you and your circumstances.
These days, thanks to tightened regulations post Credit Crunch, mortgage applications are no longer straightforward. There are a variety of things that could potentially be a hindrance when you are making your application. These can include:
Over the years, Mortgage Lenders would show their competitive side, often trying to offer better deals than the next Lender. Nowadays, because of tightened margins, their differences come from their lending criteria.
Examples of these include the amount some would lend to the self-employed compared to others, as well as being slightly more lenient to previous adverse recordings on your credit report.
Whatever the situation, it is unique to you. When you explain this to an experienced Mortgage Broker in Manchester, they will likely have encountered something similar before. Hopefully, they’ll use this experience to recommend the most appropriate mortgage for you, at the lowest rate available to you.
Our service goes beyond just the mortgage too. Customers will rely on Mortgage Advisors in Manchester for more, even if the application is straightforward. They can discuss how much they’re planning to offer on a property, recommend services such as solicitors and property surveys, and go through any available protection.
Another significant aspect of the service a Mortgage Broker in Manchester provides is the ability to be more responsive than the lenders’ direct propositions. Out of hours and weekend, appointments are common-place, as are our Mortgage Advisors in Manchester working late on an evening to respond to customers’ emails.
An often-overlooked factor of why most applicants prefer a mortgage broker is that everyone seems to be busy, and you might need someone to handle the full transaction and take away your stress. Professional applicants will see the benefits of this as they have clients of their own that they’re able to charge their services.
Maybe in the future, lenders will want to take back more clients from brokers. If this happens, it’s relatively unlikely they’ll staff-up their branch networks. They will likely make investments in technology to transact with customers online.
For clients who want to do business that way, with say a straightforward product switch, it’s great. Generally, whether they are First Time Buyers in Manchester, Self Employed in Manchester, or looking to Remortgage in Manchester, people enjoy having the “human touch” when it comes to the mortgage process.
An Agreement in Principle (AIP) is where you pass a Lender credit score to qualify for a potential mortgage. Sometimes you may also hear it being called a Decision in Principle.
With an Agreement in Principle in hand, you are ready to support any offers you make as a First-Time Buyer in Manchester. You may be able to negotiate a lower price if you have one of these as it shows the seller you are serious and have the funds to proceed.
Nowadays we see more lenders using soft searches than not, however some may still affect your credit score. This can be the case if it is a hard search, but usually a soft search should leave your credit score unaffected.
Soft searches don’t dig as deeply as hard searches, though you can trust that the lender made the correct choice either way.
If it is once every blue moon, then a hard search or two should not make too much difference. The problems arise if you start having multiple hard searches within a small window of time.
That being said, if your credit rating is good and you know it, do not let this put you off, especially if taking a hard search with that lender is the best deal.
Though it would be nice, there are no guarantees that having an Agreement in Principle will get you a mortgage. The Lender will still need to see all your documents and only then will an Underwriter make the final decision.
Often we find that customers get in touch having been declined at application stage, due to missing some small print in their Agreement in Principle. You will need to provide ID to prove that you are genuine, payslips to prove you earn the amount you claimed and bank statements to prove you conduct your finances, before a lender will offer your case.
Though it is possible to make an offer without an Agreement in Principle, we would not recommend it. An Estate Agent with credibility will want you to prove you can in fact proceed.
It is possible to obtain an Agreement in Principle within 24 hours of speaking with a Mortgage Advisor in Manchester.
Usually an Agreement in Principle will expire after 30-90 days. You do not need to worry though as this does not mean you should just apply for the first house you find. If your Agreement in Principle expires, you can quite easily have it refreshed when you are ready to make an offer.
Finding a mortgage only to be declined a mortgage can understandably be disappointing. As such, we recommend getting an Agreement in Principle as early as possible.