One of the more frequent questions we find that aspiring homebuyers ask us on a regular basis, is “how much will this all cost?”
To answer this, we have put together a list of the fees that homebuyers can expect to pay when you are considering taking out a mortgage as a First Time Buyer in Sunderland or are moving home (and when they become payable).
This type of fee is only applicable if you have a home to sell, which means you only need to know about this one if you’re Moving Home in Sunderland.
With the rise of the online estate agent, if you have a basic Rightmove listing, you could be selling your home for as low as £500.
On the other hand, if you are looking for a more personalised local service and a dedicated sales negotiator, your fee will be somewhere within the realm of 1-2%.
Your mortgage lender will require that you have a valuation carried out on the property you’re looking to buy. This will be to make sure that they are lending against adequate security.
Prices can vary from nil (for a basic valuation with some lenders) up to a few hundred pounds for a home buyers report that is much more detailed.
A full building survey can cost even more than that, so if you’re a First Time Buyer in Sunderland, it’s best to be prepared ahead of times so that you can avoid any issues in the future.
The key is being able to choose whether you want a more detailed report or not. Your decision will likely be dependant on the age or type of property in question, along with any concerns you have about the property.
Some mortgage products will offer comparatively cheap rates, though this benefit can sometimes be greatly outweighed by the arrangement fees you could be paying on them.
Not every product will have one of these fees, so the cost can sometimes be none, though it can also be a lot, for example around £999 or even more depending upon the lender and type of product.
Oftentimes these are to be paid upfront or you can choose to add these onto the balance of your mortgage, though doing so would potentially incur additional interest charges.
As a trusted and experienced mortgage expert, we are able to compare mortgage deals with all fees added, so you can accurately compare which would be best for you.
You will need to hire the services of a solicitor, with the fees of these being vastly different in quotes, depending on who you enquire with. An estimation for a straightforward purchase with a local company is £600 for a low-value property.
You will need to inform them of the property address, whether it’s leasehold or freehold property. You will also need to give the purchase price in order for you to obtain any quotations.
The key points to cover when asking for a quote are:
Depending on the price of the property you are purchasing, you will have to pay a tax of which the solicitor collects on completion of the property purchase, in addition to your Solicitor’s fees and disbursements.
Full information about the technicalities of this tax can be found here: https://www.gov.uk/stamp-duty-land-tax/
Your fast & friendly mortgage broker in Sunderland will usually charge a fee for their mortgage service. Please try to avoid any application fees where your money will be at risk.
The cost of moving your furniture can be varied, depending on who you use and the level of service you are looking to obtain.
Professional services may cost a lot more than a local van for hire service, as you are generally paying for a reputable, respected service, though you may get just as good of a customer experience from those local services.
On the other hand, if you’re looking to hire just a van and do the work yourself, this can cost less than £200, as opposed to those professional services, which can sometimes be upwards of £1,000.
We offer a variety of services, from mortgage advice, to finding you the best deal, matching you up with suitable insurance products to protect you and your family, and more.
To get started on your mortgage process or to further discuss the costs that may be involved in your process, book a free mortgage appointment and we’ll see how we are able to help you.
These days we tend to find that in our day to day lives, whether we’re homeowners, home buyers or neither, we’re a lot more savvier when it comes to checking and improving our credit rating.
Consumer awareness of credit scoring is now much higher than it ever has been. If we were to throw out an estimate, we’d say at least half, arguably more so as time progresses, have already checked their credit report online, before they’ve even gotten in touch with us.
If you’re looking online, you’ll find that there are all kinds of credit reference agencies to choose from as a customer. The most popular of these are Experian or Equifax. We would personally recommend that new customers make use of a third party Check My File for a 30-day free trial, which is £14.99 a month thereafter and can be canceled at any time.
The reason why we would recommend Check My File, is that it gathers information from several of those reference agencies like Experian and Equifax, pulling them all into one consistent report. This means you won’t need to do multiple checks and can review any potential credit file errors in one place.
We are always hearing questions from customers, wondering if we will be doing any credit searches on them. This is because they are already aware that getting too many searches done can damage their credit score overall.
Lenders will always run their own credit checks, but we will always ask for a customers permission before one is done.
There are 2 different types of credit searches that can be run on customers: hard credit searches or soft credit searches.
A soft credit search is an increasingly more common type of credit search, that tends to involve someone obtaining less information from you, but means it is unlikely to leave a footprint on your credit report.
Many lenders are switching to this nowadays, though some may still do hard searches instead. Some may do a soft search first, before following up with a hard search.
These can typically be encountered when checking out price comparison websites, so that they can give you a good indication of the products that are available to you. They can also be used to verify your identity.
Although as said, they give a mortgage lender less information about you than they’d get from a hard search, if you get an Agreement in Principle from one of these lenders, it is still very likely that you are going to be accepted at full application stage.
The reason why soft credit searches are so widely used and well liked by credit score savvy individuals, is that whilst you can see that someone has carried out a search on you (yes, you are able to find out and may be surprised how many companies have done this) these searches will not be visible to other financial institutions.
What this means, is that providing a lender uses soft credit searches, you are able to apply for an Agreement in Principle ahead of a mortgage, and it is almost certain to leave your credit score unaffected, whether it is successful or not.
If you are hopeful about making an offer on a property, it is definitely important that you get an Agreement in Principle prior to making that offer, especially if you are a first time buyer in Sunderland.
Ideally, you want to give yourself the absolute best chance of purchasing your property at the lowest price you can, so showing your finances in a positive light can help you out massively.
Additionally, having an Agreement in Principle to hand shows the estate agent that you are a serious buyer already ahead in the process, and can often put them off from trying to cross-sell their own in-house mortgage services to you.
A hard credit search is a much more detailed look at your credit score and it does leave a credit footprint. As such, any financial institution that carries one of these out, should ask for your permission before they do so.
The positive to a hard search, is that because it is so in-depth, if you pass their checks and are agreed in principle, it is very likely you are going to succeed at full application.
From this point onwards, the only thing that could really go against your chances of mortgage success, is if you are unable to provide the required documentation to backup the information you have given. False information can also affect this.
If you fail the credit scoring process with a hard search, this can seriously harm your credit score and your chances of any credit applications in the future, especially if you have failed multiple in a short amount of time.
The footprint a hard search leaves can be viewed by other financial institutions. Whilst it does not clarify whether or not it was successful, let alone why it wasn’t, multiple hard searches on a file can leave a lender to question whether or not the applicant is a risk.
Logically, if you were in their shoes; Why would someone be having multiple credit searches carried out on them if they had already passed the first one? That indicates the person has probably failed each time, and as such, mortgage lenders may be less inclined to consider lending to them.
That isn’t to say that the occasional hard footprint every now and again is a bad thing, as it is not at all. You just need to be wary of having too many done. If you happen to be moving home in Sunderland or going through a remortgage in Sunderland, a hard search may have been carried out on you, depending on your situation.
There are multiple different reasons why someone may look to obtain themselves a second or even at times, a third mortgage. A good example could be used as a means to grow your property portfolio. Alternatively, it can be used to house a family member.
Obtaining a second mortgage can be quite difficult, more so than your first one, as now you’re having to account for two sets of mortgage payments, which could have a knock-on your affordability. If you are unable to afford the costs involved with a second mortgage, the mortgage lender will not accept your application.
As a trusted and dedicated Mortgage Broker in Sunderland, we’ve seen people apply for a second mortgage for all kinds of different reasons. These include;
If you happen to be over five years into your mortgage term, the chances are that you’ve built yourself up a suitable amount of equity in your home. You can withdraw some of this equity and turn it into cash, through taking out a second mortgage.
What you do with that money is completely your choice, after all, it’s equity you’ve built up in your own home. Some people use it to fund the deposit of another mortgage, whilst others may use it to take their dream holiday. There are no limitations once you’ve withdrawn that equity.
It is worth noting though that releasing equity within your home isn’t always an easy process. Speaking with a Specialist Mortgage Advisor in Sunderland will definitely benefit you along the way. Our advisors have access to a unique and vast selection of second mortgage deals.
No matter if you’re a landlord with experience within the market already or someone who is looking into making their first purchase on an investment property, you’re going to need more than one mortgage to achieve your goals.
Buy to let landlords that have amassed themselves a suitably large portfolio will likely be used to the process of getting more than one mortgage. For those starting out as a landlord, sometimes you need help getting everything sorted properly.
Second mortgages in the form of buy to let work in a similar way to the first mortgage you took out. You still have to meet the mortgage criteria and put down a deposit (typically 15%-25% of the property), as well as passing affordability checks.
Affordability in this case isn’t always down to your own income though, as some lenders will look into what the predicted rental income will be expected and stress test this against their own multiples.
No doubt the cost of your mortgage payments should be sufficiently covered once you have found tenants and they have moved in. Initially though this might prove challenging, so you need to be able to cover the costs until the income starts to flow.
For Buy to Let Mortgage Advice in Sunderland, please feel free to speak with our buy to let mortgage experts here at Sunderlandmoneyman.
This sort of process is what is known as a let to buy mortgage. Some homeowners will have an option to get a second mortgage on a newly purchased home, allowing them to rent out their current home and move into a new home for themselves.
Let to buys are of course very similar to buy to lets, it just works a little bit differently. In this case you need to find a tenant for your current property, in order to move out yourself. Landlords may do this if they want to move themselves into a bigger family home.
Our Buy to Let Mortgage Advisors in Sunderland also have a lot of experience and knowledge in working with let to buy mortgages, so get in touch if you would like an advisor to help you with a let to buy second mortgage.
If you have any children or other family members that are having some difficulty in getting themselves onto the property ladder, you may have the option to take out a mortgage in your name and allow them move into the it as their new home.
Going down this route will likely land you with a guarantor mortgage.
Another popular option that some people go with is to gift the person in need their deposit. Gifted deposits are crucial to the property market and are always a fond option for helping a loved one find their footing on the property ladder.
As noted in this article, there are various reasons as to why you can be listed on two mortgages. Sometimes it’s something you’ve planned for, but in other cases it can be completely unintentional.
We regularly find through our work as a Mortgage Broker in Sunderland, that one of the most common reasons for someone taking out a second mortgage is divorce or separation.
The difficult part here is that it can be hard to remove your own or your ex-partner’s name from the mortgage you share. This is once again down to affordability, but also down to both parties having to mutually agree.
Though it may come with challenges, it is not entirely impossible to obtain a mortgage post-divorce or separation. If you are in a similar situation, there may be some mortgage lenders out there who will give a bit of leeway considering your current personal situation.
If you’re named on an existing mortgage for a home you no longer live in, you should look to get your name removed as soon as possible. Having financial ties to someone can sometimes bring your overall credit score down, especially if the other person is bad at managing their finances and getting into arrears regularly.
The majority of mortgage lenders out there will allow their customers to make ‘over-payments’ on their mortgage. Overpaying on your mortgage will provide you with an opportunity to clear your mortgage debt quicker, saving money on interest payments.
The fact of the matter is, if you have the ability to overpay on your mortgage, you could potentially save yourself thousands of pounds. On top of that, you will clear your mortgage quicker and save money on the amount of interest that is paid overall.
Any experienced homeowner will know that overpaying, even if it’s only by a little, can make such a difference to your mortgage amount. The sooner you are able to start overpaying, the better it will be for you.
The only real downsides to overpaying your mortgage, is that if you are in your fixed or introductory period, you usually have a cap. Also, unlike an Offset Mortgage, it does not work like a savings account. This means you can’t withdraw anything you put in if you need it; your overpayments are locked in.
Whilst it is a great habit to get into, as an experienced Mortgage Broker in Sunderland, we know that a lot of homeowners cannot afford to make the extra mortgage payments. Generally the reason for this, is that life simply gets in the way of it.
On one hand, we know that it’s probably in our best interest to overpay. On the other hand, look at all the other things we could be spending our money on!
Right off the bat, part of the issue is making sure that you remember to make those overpayments. We know that the likelihood of something like that crossing your mind is pretty slim, perhaps only cropping up when your mortgage is due to end. At this point, you’ve missed out on a lot of the benefit of doing this.
So with that in mind, if you can relate to those circumstances and want to get ahead of the curve, to prepare yourself to overpay, what should you do?
Well first of all, you are going to want to make sure that your lender will allow overpayments. The majority of them will, but it’s always better to be certain in advance. You will also want to clarify that there are not any penalties or associated costs.
For the most part, you will be capped for up to 10% of your mortgage, without penalties, if you’re still in your fixed, discounted or introductory period.
If you are beyond that, happen to be on a tracker mortgage or have gone onto the lenders Standard Variable Rate, usually you will have no limit and no penalties when it comes to overpaying.
We would definitely recommended that if you are able to set up a standing order to overpay the lender each month, that you do so. The best practice would be to set it up so that the extra amount goes out on the same day as your monthly mortgage payment does.
For example, let’s say your payment goes out on the 1st of every month and is (if we round up for example purposes) £500 each month. Your wage has increased and you now have £75 extra disposable income per month. Set up the standing order for £75 to the mortgage lender, and have it go out on the 1st as well.
Doing so will get you into the habit of feeling like your mortgage balance is £575 per month anyway, and you’ll be able to budget the rest of your income accordingly.
If you’re not able to guarantee a set amount each month, you don’t just have to set up a standing order. Technology has advanced so much that these days, you could simply load up your banking app or online portal, and just transfer the amount in that you’d like.
Alternatively, for those who prefer to speak with a real person, you can also phone up your lender and make an overpayment with your debit card.
Of course the big advantage for those setting up a standing order, is that you are in control. If you can’t afford to overpay that month, you can log into your online banking to pause that standing order until you’re able to overpay again, at which point you can resume it and carry on.
For those who are just paying as and when, it’s as simple as just not overpaying that month.
Even if you do have to stop the payments for a time, you have at least benefited from those additional payments up until that point. You have significantly reduced the amount of interest you will have to pay overall, and that can only be a positive.
Depending on your lender, if you have been overpaying for a long time, they may allow you to make a few reduced payments or even take a payment holiday. It is crucial to ask the lender before doing this though, as it could look bad on your credit report.
Regardless of if you are a First Time Buyer in Sunderland or you are going through a Remortgage in Sunderland, overpaying your mortgage is an amazing habit to get yourself into. Who wouldn’t want to reduce their overall debt?
You don’t need to go too far with it either. Making some casual, affordable overpayments each month could actually mean knocking a year or two off your mortgage overall, so you’ll really notice the benefits!
If you have any further questions regarding this strategy or have another mortgage query that you would like to discuss, book your free mortgage appointment today.
You can select a time and date that best suits you, subject to availability, and speak to a qualified Mortgage Advisor in Sunderland. We look forward to hearing from you!
So you have passed all of your exams and have successfully achieved your goal of becoming a Newly Qualified Teacher. The next thing for you to do is to put your skills to use and find yourself a job that utilises your well deserved qualifications!
You may find that due to the nature of your new career, you will need to start taking a look at what your options are for Moving House in Sunderland, if perhaps you currently have a home that is a bit further away than where your new place of work is situated.
Fairly soon you’ll find yourself on the hunt for somewhere else to live, potentially finding it difficult to balance both homeownership and finding your footing within your newfound teaching role.
You are not alone in this endeavour, however, as over the years we have helped lots of home buyers and homeowners who are under just as much stress in the same situation, needing someone to take on their mortgage whilst they keep their minds focused on their new career.
It can be a little complicated trying to find a mortgage lender who is happy to offer a mortgage to a newly qualified teacher.
The main reasons that issues tend to arise is either due to the fact that they don’t have work history to go off or because the contract is only a temporary one.
Even bearing these in mind, you do still have options out there if you’re looking to obtain a mortgage as a Newly Qualified Teacher. Our Mortgage Advice team have helped lots of customers with these over our time as a mortgage broker in Sunderland.
Every so often, you may come across some mortgage lenders who have preferrable deals specifically suited to people who are working within the public sector.
The secret to finding success here, is making sure you go with the best mortgage lender for your circumstances, which in this case is generally the most difficult part of the mortgage process.
It is when situations like this arise, that our experienced mortgage advice team in Sunderland can search through thousands of mortgage deals on your behalf, working hard to find the perfect deal for your individual circumstances, with preferable rates.
You should remember that whilst yes, the process may be challenging sometimes, you are not restricted altogether in the options that you may be able to take.
Here are some of the mortgage types that we find are commonly associated with cases referring to Newly Qualified Teachers:
The lender may consider a few different factors as well when it comes to an NQT mortgage. There are mortgage lenders who will not need to look at previous employment, as well as allowing you to access up to a 95% LTV (loan-to-value).
Depending on lender, a 12-month first contract may be considered as being the same as a permanent job role, as opposed to being seen as a temporary contract.
Last of all, you may find that there are some lenders out there who are willing to make a start on your mortgage prior to your start date, though this will require evidence of a signed contract and a confirmed start date.
This can be very useful, as you could be ready to start making your first mortgage payments with your first lot of income from your new job by the point of mortgage completion.
Our hardworking team of open & honest mortgage advice experts in Sunderland have a great deal of knowledge and experience of working in and amongst the world of mortgages, helping a large variety of home buyers with their mortgages.
There are many different perks to using a trusted Mortgage Broker in Sunderland. We aim to take the stress away, searching through thousands of unique mortgage deals of your behalf, suggesting potential conveyancing solicitors and doing so much more.
Find out what options are available to you as a home buyer, by booking yourself in online for a free mortgage appointment with one of our fantastic mortgage advisors in Sunderland, who will gather some initial information from you and guide you onto the next step in your mortgage journey.
Here we have put together a comprehensive list of the 10 steps that you will go through during your mortgage process as First-Time Buyers in Sunderland, hopefully allowing you to be as prepared as possible ahead of your mortgage journey.
The 10 steps of home buying and obtaining a mortgage during your process are as follows;
Buying your first ever home and taking out a mortgage on it as a First-Time Buyer in Sunderland, will likely be one of the largest financial decisions that you make throughout your life.
Once you come to realise this, the thought of it can be a little off-putting, especially when you haven’t done this before.
It is here that you will truly benefit from the assistance of a dedicated mortgage broker in Sunderland, who will be ready to step in and help you through your process.
We will always aim to reduce your stress and do everything within our power as your mortgage broker in Sunderland, to make sure that you come out the other side with a mortgaged first home, happy with the deal we found for you.
When you contact us for mortgage advice, you’ll be booked in for a free mortgage appointment with an experienced mortgage advisor in Sunderland.
During your appointment, we’ll gather some information from you and take a look at your property owning plans, before starting your mortgage process.
During your free initial mortgage appointment, your dedicated mortgage advisor will be able to run through a mortgage affordability assessment with you.
This is where your advisor will have a look at all of your monthly income and regular spendings, to figure out whether or not you have the ability to afford the monthly repayment costs for how much you are looking to borrow for a mortgage.
Doing this is incredibly important as we need to be completely confident before we put you forward with a lender, that you have the ability to afford your monthly repayments.
This is done to avoid potential arrears and your home being repossessed. Your lender will desperately try to avoid this situation occurring.
A Mortgage Affordability Assessment will typically be checked by the lender in their own time, so in doing our initial check, we will hopefully save both your and the lenders time from an application that may potential fail, due to being unable to afford the mortgage amount.
Once you have gone through this step, the next step for you to go through will be to get a Mortgage Agreement in Principle, to back up any offers you make.
If you’ve been doing some research regarding mortgages before enquiring about First-Time Buyer Mortgage Advice in Sunderland, you may have seen this under a handful of different, but fairly similar names.
These names may include ‘Decision in Principle’, ‘Mortgage in Principle’, as well as a few shortened versions such as ‘DIP’ & ‘AIP’. These are all the same thing, only their names are different.
The reason for having a Mortgage Agreement in Principle is to create a record that you have passed a lender’s primary credit scoring system, either via a hard credit search (which will leave a credit footprint on your file) or a soft search (which will not leave a credit footprint on your file).
This will not be a guarantee that you will be accepted for a mortgage but will be essential on your way towards your final goal. Another perk of your AIP is that it will show the seller that you are serious, and may even help with price negotiations.
A standard AIP will typically last between 30-90 days, and you can renew it once it expires. We are usually able to obtain one of these for you within 24 hours of your initial mortgage appointment.
Following on from obtaining your Agreement in Principle, you will need to set about finding a Conveyancing Solicitor (Conveyancer) to help you sort out all of the legal proceedings of your home buying journey.
The term Conveyancing is the name given to the transfer of legal ownership of property between the involved parties, whether you are the buyer or seller.
Your Conveyancing Solicitor has the ability to handle contracts, provide you with the necessary legal advice, conduct local council/authority searches, deal with Land Registry and last of all, transfer your funds for the property payment.
As you might expect from that description, this is a very crucial role in your process, so you will need to make sure that you choose your conveyancer carefully.
It’s also important to bear in mind that Licensed Conveyancers are property specialists who are not able to deal with more complex legal issues, whereas a more general Solicitors has a larger range of services, but in turn may cost more.
Whilst these services are not something that we ourselves offer in-house, we do have a few trusted companies that your dedicated Mortgage Advisor in Sunderland will be able to put you in touch with.
Now at this point you will have had a chat with a Mortgage Broker in Sunderland, passed the Mortgage Affordability Assessment, gotten yourself an Agreement in Principle and hired a Conveyancing Solicitor to deal the legal side of things.
This means that now at this point, you are halfway there and the next step for you to take is to make an offer on the property that you desire to make a purchase on.
As touched upon previously, with an Agreement in Principle on hand, you will have a better chance in negotiating the property price.
Keep in mind not to low ball the seller, as this may offend them, though you shouldn’t be afraid to ask for a lower purchase price.
Knowing that you have a mortgage Agreement in Principle, it is more likely that the seller will look to go with you, over someone who is happy to pay the exact asking price but is not prepared for the mortgage process.
The worst-case scenario is that the seller won’t accept your offer, but once that has happened, you can simply work out a more reasonable offer that you can both agree on, or walk away and find another property for yourself.
Once you’ve had an offer accepted, it all comes back to your mortgage advisor, as we head into the final leg of your mortgage process.
Now as we delve more into the mortgage aspect of your journey, it’s time to look at an important factor; submitting the necessary documents.
As you could probably come to expect when you are dealing with such a large amount of funds, a mortgage lender is not just going to lend to anyone, they’re going to be understandably picky.
You will be required to provide the lender with a handful of documentation that will prove to them your identity, your income, your current place of residence and how you as a potential borrower tend to conduct your finances.
If you’re obtaining a mortgage jointly with a friend or a partner, they will require both of you to provide this documentation.
The types of documents that a lender will need to see include;
Now that your mortgage has been agreed in principle and you have had an offer accepted, we can now get onto the next step, which is to submit your full mortgage application.
Once everything has been checked by your dedicated Mortgage Advisor in Sunderland & their hard working team of Mortgage Administrators, we can move onto submitting an application to the lender, hopefully resulting in you getting your mortgage.
Your advisor will send off all of the different documentation that they collected from you to the lender, and then it’s just a matter of patiently waiting for their response, informing us as to whether or not the application has been accepted.
Whilst we can never confirm a specific time frame as to when that response may be, our Mortgage Administration team will regularly chase up the lender and try to find out for you.
In-between arranging your mortgage application and the point of being offered a mortgage, the mortgage lender in question will require a valuation survey of your new home to be taken out.
These surveys are typically carried out by accredited companies that will be nominated by the mortgage lender (this is basically just someone who they trust).
The purpose of doing this is to gain an understanding of the true property value, versus what you and the seller have agreed on as a purchase price. If you’re paying above what it is actually worth, the lender may be less willing to work with you.
This is because in the event of arrears, the lender could quite possibly end up out of pocket and unable to make back the full amount they let you borrow for the property. This type of process is known as a ‘Down Valuation’.
There are various types of property survey available to home buyers, with these differing based on price. Some will just want to check how much the property is worth, whereas some will inform you of any structural concerns and possible necessary repairs.
Your Mortgage Advisor in Sunderland will be able to help you figure out which property survey is best for you to take out.
Now enter the endgame of your mortgage process. At this point your lender has had a look at your case and analysed all the evidencing documentation, meaning all that is left is for them to present you with your Mortgage Offer.
From here, our dedicated team of expert Mortgage Advisors and Administrators in Sunderland, that you’ve become quite friendly with throughout your journey, will have one last check over the offer for you, to ensure that it is right.
Once you have received your mortgage offer, it’s the job of your Conveyancing Solicitor to complete your mortgage process.
A congratulations is now in order! You have officially graduated from being a First-Time Buyer in Sunderland to a First-Time Homeowner in Sunderland.
With any stresses that you have had all throughout now firmly behind you, we hope you’re pleased with everything and ready to begin your new life, in your brand new home.
All that is left is for you to get your keys and move in! We hope our expert team were good to you and that you received a top quality, fast & friendly Mortgage Advice service in Sunderland.
If you have chosen a fixed-rate mortgage, once your mortgage term reaches its end, we will be in touch to give you a hand again with your Remortgage!
If you unfortunately reach the point where you are faced with divorce or separation with your partner, it can be stressful. This can only be heightened when you factor in that you may have a joint mortgage together, as well as other finances.
In this handy mortgage guide, we have put together a short list of the frequently asked questions we receive when customers are in this situation and need to make mortgage arrangements.
No matter what you currently have going on, you will always need to keep on paying your mortgage, even if for the time being you are living somewhere else.
You agreed with your now ex-partner to take on equal responsibility of your joint mortgage. This means that until the mortgage is paid off, you are both equally liable for any debts, no matter what the situation is or where either of you are living.
If you do not pay your mortgage on time, you can cause some serious harm to yours and your ex-partners credit history. Likewise if your ex-partner fails to make payments, you will be affected.
You also run the risk of your home being repossessed if you do not maintain your monthly repayments on your mortgage or any other debts that you have secured on it.
As soon as your separation is official, you need to get in touch with your mortgage lender as soon as you possibly can and let them know, especially if meeting your monthly mortgage payments is going to be difficult.
If it is decided between the two of you that you should each move out of the property, sell up and pay off your remaining mortgage balance, any remaining equity will be distributed between you both.
It is entirely up to debate who gets what from that remaining equity.
If you move out and are looking at your options for purchasing a new home, under your sole name, our dedicated team of mortgage advisors in Sunderland are on hand to talk to you all throughout the week.
They will help to recommend the best mortgage deal to you, providing a service of fast & friendly mortgage advice in Sunderland.
If you separate but end the relationship on good terms, some decide to remain within the property and continue paying off the remaining mortgage balance.
This can prove to be a beneficial route to take, especially if you have a fixed rate mortgage term.
If you end up deciding that either you or your ex-partner will remain living in the property, whoever is currently residing there will have to take out a Remortgage in Sunderland, in their own name.
As the sole owner of the property, if there is still an outstanding mortgage to pay off in both you and your ex-partners names, you will need to take out a Remortgage.
This new mortgage that you have will be in your sole name, which means the lender will have to reassess your affordability.
Depending on the circumstances, you may be able to have more than one mortgage. Lenders each have different credit scoring systems and when you apply for a second mortgage they will analyse various factors.
The main factor that they will look at is if you have any current financial commitments. Before you apply for a mortgage, you need to be certain that you can afford a second mortgage.
The reason for this is that if you do end up being declined for a second mortgage, it could have a large negative effect on your credit file.
You will be pleased to know that our team of mortgage advisors here at Sunderlandmoneyman are able to help you out with credit searches that will have less of a impact on your credit file.
Once we have put together the necessary information, we will then be able to give you an idea of the maximum mortgage amount you could borrow.
This will help you to gain a better understanding of your budget and what you can expect for your monthly mortgage payments, in addition to all of your current financial commitments.
Moving on from your current financial commitments can be quite a difficult process, and this is why having an expert Mortgage Advisor in Sunderland to help you through each step will be very beneficial to you and your case.
Moving Home in Sunderland can be stressful, especially when factoring in divorce or separation. Get in touch with a dedicated Mortgage Advisor in Sunderland today, and we will look at how we are able to help you.
If you get divorced while the home that you both own jointly is in negative equity, it can be particularly difficult to sell the house and pay the remaining mortgage balance off.
You might have to divide the debt that is remaining between the two of you or come to an agreement with your current mortgage provider.
When you start looking at applying for a mortgage, usually we find that the large majority of applicants in relationships will jointly apply for a mortgage, rather than applying for a mortgage in one of the couples sole name.
With property prices always on the up and inflation pulling ahead of wage increases, lenders will generally prefer that first-time buyers in Sunderland have two incomes to cover the mortgage if they have the option to do so, rather than both of them living there and only one person being responsible for the mortgage.
On the flip side, sometimes you might find that situations come up that may potentially make it viable for a sole name to apply for a mortgage. This can be down to anything from one of the applicants not wanting to have their name on the mortgage, to a financial issue coming up.
We also see in some cases, that one of the partners may not be in work in the moment, be that a choice or down to circumstance.
When we say financial issues, this could be something like a bankruptcy or county court judgement, factors that could affect the other applicant and also their overall chance of obtaining a mortgage. In these cases, it’s much better that there be no tied finances and that only one of the parties apply for the mortgage in their name.
Definitely make sure you’re careful, as one half of a couple getting into trouble financially can significantly harm the other half in their attempts to apply for credit, especially something as large as a mortgage loan.
For the most part, the rule of thinking to stick to is that 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.
This is something that happens on a regular basis across the mortgage world the mortgage world. Age is something that may also be factored into working out how much you can borrow. This may become prevalent in the event where maybe an applicant is over 50.
To use an example of how this would affect your mortgage; Let’s say you are over 50 and your partner is in their late 20’s, early 30’s. They have a well paying job and have plenty of time to pay off a mortgage before they hit your age. If they applied in their sole name, they may very well have access to a much higher mortgage amount.
The effects of stamp duty or something else relating to tax may be a potential reason as to why a couple may choose to only have one of them apply for the mortgage in their own name, rather than as a couple.
You’ll find that there are a fair amount of lenders with strict criteria regarding married mortgage applicants, as it is a mortgage that will be involving two people who are connected in a strong way. Whilst applying under a joint name gives security to the lender in the event of arrears, it can have its problems.
The reason for this is that if you happen to get divorced at any point down the line, it’s a difficult process trying to remove one of your names from the property. Our team of mortgage advisors in Sunderland can help with this, but you should definitely give plenty of thought before jumping in headfirst with your partner.
Luckily for those applying for homes, not all are as strict and prepare for the worse, so there will be options out there for you to choose from. We have specialist mortgage advisors in Sunderland, available every day of the week to help you find mortgage success.
We’re proud of the level of service we are able to 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!
Once you take the leap of faith and decide to start looking for your first home, it can be tricky knowing where to begin. Buying a house in any mortgage situation can be a stressful experience.
You could be starting your home buying journey for a second time as a home mover; a local landlord with hopes of growing your buy to let portfolio; a self employed applicant struggling to match with a deal that suits your working life and financial situation; or a completely different situation, nevertheless you’re all in the same boat.
Everyone’s home buying journey will be tricky, it’s never easy to buy a property! As a first time buyer in Sunderland, you will unaware of all of the things that come with buying a home. Even more specifically, you may not know how much deposit you need to put down.
When buying a home, you will need to provide a deposit. The deposit amount that you put down will differ from applicant to applicant as financial situations, income and credit scores, etc., will change.
A deposit is one of the forms of evidence that a lender needs to know that you’ll be able to afford a mortgage on the property that you’re buying. Deposits are based on a percentage of the property’s price. Depending on different factors, the minimum percentage that you need can change.
Providing that you have a clean credit history, and your lenders find you to be a ‘reliable’ applicant, you may only have to provide a minimum of a 5% deposit. In turn, if your credit score is poor and you don’t seem like a ‘reliable’ applicant, they may require you to put down a deposit greater than 5%. We’ve seen them ask for 10%-15% before now.
Of course, the total deposit amount can vary from property to property; when the property price goes up, the deposit naturally will too. A 5% deposit on a £150,000 would be very different to a deposit for a home valued at £360,000.
Unfortunately, sometimes the deposit that’s required can change if the economy is performing badly. For example, during the coronavirus pandemic in March 2020, the property market crashed, leaving some lenders wanting a minimum of a 15% deposit!
If you put down a greater deposit than the minimum amount required, your chances of being accepted could slightly increase. Therefore, if you find your dream home and you have more than a 5% deposit, you could put down more if you want to.
As a mortgage broker in Sunderland, when we see applicants putting down a greater deposit, it’s usually because of a gifted deposit giving them a boost. A gifted deposit is simply a family member or friend gifting the applicant funds to help make up their mortgage deposit. If you are nearly at the 5% mark and then you receive a gifted deposit, you could have a deposit around the 7% mark, which can only benefit your application.
If you’re struggling to make up your deposit as a first time buyer, there are different ways that can help you get there. The government have created new ways to help first time buyers (like you) get onto the property ladder.
‘Own Your Home’ consists of lots of different schemes that can help you start your homebuying journey. Most of these schemes were introduced off the back of the credit crunch in 2012. The schemes helped pump confidence back into the market, meaning that buyers could comfortably start their home buying process without feeling worried that something could happen.
Now there are even more schemes than there were in 2012. ‘Own Your Home’ includes more than 10 homebuying schemes to help all types of buyers to get onto the property ladder. However, there are a lot more schemes targeting first time buyers, like yourself.
Schemes that you should be aware of include:
Our mortgage advisors specialise in help to buy mortgage advice in Sunderland as well as other mortgage schemes. For more information on these schemes and help to see whether you qualify them, get in touch with our team.
There are only few situations where you will not need a deposit for a mortgage. One example would be if you have a family discount on a property or a gifted deposit that covers the entirety of the deposit. Another example would be if you were a council house tenant and you wanted to utilise the Right to Buy scheme to buy your home and the discount provided by the government covered the deposit.
Customers have also asked “can I take out a loan for the deposit?”. As a mortgage broker in Sunderland, we would not recommend doing this. Lenders will be able to see that you’ve done this and may penalise you for doing so. If you do this, you’re essentially borrowing 100% of your mortgage, which also means that you’ve got two large loans to compensate for.
In summary, in most situations, you will need a deposit. A deposit is not only a good piece of evidence that you can afford a mortgage but shows that you’re reliable and have saved up overtime to get to your target amount.
As a first time buyer in Sunderland, it’s likely that you’re going to need a minimum 5% deposit. However, remember that this can change depending on different factors such as your credit score and evidential documents like bank statements.
If you are look for first time buyer mortgage advice in Sunderland, feel free to get in touch with us. We are an experienced mortgage broker in Sunderland that has been working within the mortgage industry for over 20 years now. We know that it can be tough starting off your home buying journey with little no experience, and that’s why we’re here to help.
The first question that you might ask is how many different types of mortgages are actually out there for customers?
You’ll find that there are a wide variety of different mortgages that are available to prospective home buyers. Each of these mortgages have their own unique advantages or disadvantages to taking them.
In this article, we will take a look at tracker mortgages and why they might potentially be the best mortgage option for you and your personal circumstances.
Always remember that a mortgage deal will only be as good the circumstances that it is matched up against.
To use this in an example, you may find yourself signed up onto a tracker mortgage, only to later decide that you would rather have fixed monthly mortgage payments. Unfortunately at this point, you are locked into a deal and cannot switch out of it.
As an open & honest mortgage broker in Sunderland, we will always highly suggest that you do some of your own research prior to this, or alternatively take mortgage advice in Sunderland.
A mortgage advisor in Sunderland will be able to make sure that you are at least on the most appropriate mortgage deal for your personal and financial circumstances.
If you would prefer to have a look at our YouTube video, you are more than welcome to hop on over to our MoneymanTV channel and watch “What is a Tracker Mortgage?“. Alternatively you can view it below:
So the question on your mind is likely, what actually is a tracker mortgage?
Well, if you are signed onto a contract with a tracker mortgage, your interest rate will run alongside the Bank of England’s base rate, with the lender typically adding a percentage on top of it.
Your lender will not be determining the rate that gets added, as it is an external rate that must be strictly followed.
For example, if the base rate of the Bank of England was around 1% and your mortgage lender adds on another 1%. You’re now running at a 2% interest rate.
The percentage will always be a little bit above the base rate set by the Bank of England.
A tracker mortgage works out really well for customers if the Bank of England’s rate is running a little low at the time of application.
Generally speaking the base rate will sit somewhere around 0-1%, though it will rise and drop down again throughout the course of the year.
Back during the unfortunate era that was the credit crunch in 2007/08, the mortgage market completely crashed, which caused the interest rate to skyrocket. The highest we ever saw it go up to was somewhere around 5%.
Bearing in mind that you’ll also have the percentage that your lender will add on top of this, and you could’ve added 6% interest onto your recurring mortgage payments.
On the flip side to this, during March 2020, the mortgage market went through another tough time, this time because of the impact of COVID-19. The opposite happened this time, as here the Bank of England’s rate decreased massively, dropping all the way down to 0.1%.
If you were on a tracker mortgage throughout this period of time, the chances are that you were sitting comfortably on a 1.1% interest rate.
As you might expect for something so good to be true, during this period, new customers couldn’t pick up a tracker mortgage. The reality is, lenders are in the business of making profit, not losing it.
At this moment of writing, we’re just heading towards the end of the Coronavirus, and it is admittedly still difficult to obtain a tracker mortgage.
Taking out a tracker mortgage has both pros and cons. These types of mortgage rely heavily on the economy, so if the market isn’t performing at it’s best and the Bank of England’s rate is high, a tracker mortgage probably isn’t your best option.
Again, by completely flipping the situation, if the economy is performing outstandingly well with the Bank of England’s rate at a lower amount, a tracker mortgage may be one of the better mortgage options for you to take.
No matter your mortgage scenario, there are such a wide array of different mortgages that are available to you in Sunderland, it’s just about working with a mortgage advisor in Sunderland to find you the right one.
Before you go ahead and dive into any deals, it is highly recommended for your own benefit to speak with a dedicated mortgage advisor in Sunderland about your possible mortgage options.
They will help you shop for different potential mortgage deals, working hard to find you the most competitive one for your personal circumstances.
If you are a first time buyer in Sunderland, our trusted and refined mortgage advice service will prove to be highly beneficial.
We have been working within the mortgage industry for a very long time, well over 20 years now and have a lot of industry knowledge on all the different types of mortgages, including those that benefit first time buyers the most.
This applies even if you are looking at your options to remortgage in Sunderland or if you are moving home in Sunderland, as we believe that you’ll genuinely benefit from using our invaluable mortgage advice service.
As an mortgage broker in Sunderland with a flood of knowledge and experience, we will work from beginning until end by your side, aiming to be a guiding light throughout your mortgage journey.