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If you need to know precisely how much your mortgage payment will be, we recommend you should take out a fixed-rate mortgage. The longer you settle for, the higher the rate becomes.
If you are looking at finding the cheapest possible fixed-rate mortgage, then a two year fixed rate might be right for you. The payments will be low, but on the downside, two years comes around quickly, and it won’t be long before you have to look for a new deal again. However, if interest rates go up in the meantime, then you may be faced with higher payments at renewal.
If you don’t like the hassle of applying for new mortgages all the time, then a five year fixed rate would be better. Your payments would then be stable for a much more extended period. Five year fixed rates are more expensive than two or 3-year deals. A potential negative would be if interest rates fell during the fixed-rate period, then you would not benefit from a reduction in monthly payments.
While two years and five year fixed rates are the most popular, and you can settle for longer. Some Lenders offer seven or 10-year fixed-rate mortgages.
These long term fixed-rate mortgages have never been massively popular in the UK. Perhaps we feel that much can change in a decade and we don’t want to get hooked into a deal we can’t get escape.
If your circumstances change then, it can cost you money to repay your mortgage early. In any case, an Early Repayment Charge (ERC). The ERC gets calculated as a percentage of what you owe. For example, if you settle a £100,000 mortgage early and the early repayment charge is 2%, then you would incur a £2,000 penalty for breaking the contract.
It’s usually a mistake for the customer to think about “beating the system” or predicting what will happen to interest rates in the future. When selecting how long to fix your mortgage for, focus on your situation. For example:
We strongly recommend you also avoid chasing “headline” deals. The lowest rates often come with high arrangement fees which some customers are keen to avoid.
On an overall basis, the mortgage process can often come across as quite surprising and applicants can expect to experience their fair share of both ups and downs. Some applicants may receive a quick and easy process whereas others may find it a lot more challenging trying to reach mortgage completion.
Regardless, once you have secured your first property, moved in and lived there for almost the entirety of your term, you will eventually reach a point where you have to make some choices from which path to take next. First of all, you could have the option to sell your current home and move into a new home.
Alternatively, if you feel like you’ve already found the home you want to stay in for the rest of your life, you may look to remortgage for home improvements. Common choices for this include to fund either an extension or conversion.
In this article, we are going to take a look on remortgaging and the various reasons why people may look to take out a remortgage in Sunderland.
A remortgage is where you take out a new mortgage to pay off the mortgage you already have. There are lots of different options to choose from at the point of remortgage, it’s entirely your choice.
As a general rule of thumb, you will take out a remortgage each time you reach the end of your fixed mortgage term. If you opt to not take out a remortgage, you may find that you possibly fall straight onto your lender’s standard variable rate of interest, which will probably be more costly than the rate you’re currently on.
The mortgage deal that you’re on initially will likely last for near 2-5 years. As touched upon previously, if you don’t remortgage, you will move onto your lender’s SVR.
Sometimes, their own rates can be higher than that of a tracker mortgages (track the Bank of England’s base rate), so in the long run this could cost you more than you would otherwise need to pay.
If your mortgage term ends, you may also find yourself falling onto a tracker mortgage. The interest rates of a tracker mortgage will go up and down depending on how the current United Kingdom economy is performing.
As an example of this, during the coronavirus pandemic (March 2020), the Bank of England’s interest rate was much lower than it usually is, as the economy wasn’t performing at it’s best. Over time, the economy recovered, causing the interest rates to rise once again.
It’s reasons like this why people often remortgage to find themselves a much better interest rate. Homeowners look to find themselves a better interest rate in a bid to lower their monthly mortgage repayments.
Rather than moving home in Sunderland, a lot of homeowners look to make modifications to their existing home, so that they can create more space through either a home extension or loft/room conversion. Some will also remortgage to fund other smaller home improvements such as doing up the kitchen or living room.
The way that this process will work, is when you take out a new mortgage product, the costs for any home improvements will be incorporated into your mortgage. This means that your monthly payments and mortgage term will likely increase.
If you already are wholly fond of the house that you have, making improvements over moving could save you a lot of money. It can potentially be easier, less stressy and provide more benefits in doing so, that the stress and cost of moving home.
As a long standing mortgage broker in Sunderland, we’ve regularly seen mortgage applicants that have realised further down the line that they would prefer a different product, however, they are already mid-way through their existing term.
It might just be that they are wanting a more flexible product that will allow them to reduce their mortgage term. Though this could mean a monthly mortgage payment increase, it could mean their mortgage term will decrease.
A flexible mortgage could give you the option to overpay your mortgage payments do that you can pay it off quicker. Usually, people choose to remortgage if they’ve maybe had a pay increase or been given a large lump sum of money, i.e., through being made redundant at work.
Some people may even want to keep the same monthly payments and still stay on their current base rate. When this is the case, you may have the option to remortgage for a term extension.
As a homeowner, it is likely you will have some equity built up inside of your home. You can turn this equity into cash, which is why people often remortgage to release equity.
The amount of equity that will be in your home can be calculated by taking away the remaining amount on the mortgage from the value of the property. A portion of the amount that is remaining can be taken out and used for whatever you’d like (within reason).
It’s up to you what you spend this money on. As mentioned, some use it for home improvements, others use it for a deposit for another property (common with buy to let landlords) and some use it for paying off car loans or taking a holiday. It’s entirely your choice.
If you are over the age of 55 and own a home with a minimum value of £70,000, then it may be worth looking at Equity Release in Sunderland. To see if a later life mortgage is right for you, book a free mortgage appointment with a later life mortgage advisor today.
Firstly, debt consolidation is considered a very specialist subject, so we would highly suggest that you speak with a mortgage advisor in Sunderland before making any sudden decisions.
Consolidating debts means you will be incorporating unsecured debt into your mortgage. Doing this will increase your mortgage payments and can also increase your mortgage term too.
All lenders have a different perspective when it comes to consolidating debts into a mortgage. Some lenders are fine with it and some don’t have it as an option. Lenders often don’t allow it, as you are placing existing unsecured debt into a secured asset.
This means that if for one reason or another you can’t meet your mortgage payments and start to accrue any debt, your property is repossessed. In doing this, the lender will lose out on money as the debt you have is now secured within the property.
The subject can be quite difficult and is something that you should get specialist help for. For debt consolidation and remortgage advice in Sunderland, you should contact our excellent mortgage team, taking advantage of the free mortgage appointment we offer.
Having now read about the various reasons why people may look to remortgage and how they work, maybe you think it’s time to start looking at arranging your remortgage?
Whether you’re looking to remortgage for better rates, for home improvements, for a more flexible term, to release equity, to consolidate your debts into your mortgage or for something else we haven’t mentioned here, one of our dedicated mortgage advisors in Sunderland will have likely had experience in helping someone remortgage for that reason before.
If you would like to have a chat with a remortgage advisor in Sunderland about remortgaging your property, feel free to give us a call and speak to a member of our team. We will be more than happy to try and help you through the remortgage process and get back to life as normal.
If you’ve been thinking about taking that step onto the property ladder, you may be wondering whether or not to use the assistance of a mortgage broker in Sunderland. We of course believe that our service is incredibly beneficial, especially for first time buyers in Sunderland.
Despite this, we felt it appropriate to give a balanced overview of the pros and cons of coming to a mortgage broker in Sunderland, compared to direct to a mortgage lender.
People tend to think that they are more likely to save money by not using the services of a mortgage broker. It can seem a lot more cost-effective to just do everything by yourself.
With that in mind, you may be one of those who prefer going directly to the high street mortgage lender. Another reason why people used to prefer going to the bank directly, was that people felt their bank manager knew their finances inside and out, although this changed when credit scoring was brought into the mix.
There is also truth to the claim that some lenders have additional exclusive mortgage products only for the people who directly obtain a mortgage. The main intention behind such ideas is to attract customers away from the services of a mortgage broker.
Ultimately, it is a good way for them to spread the business. The interesting part is that it is arguably just as enticing to speak with a mortgage broker in Sunderland as well. You’ll find that some mortgage offers can only be obtained through a mortgage broker.
From 2014 onward, lenders were no longer able to sell mortgages to anyone on a non-advised basis. At that time, it was a common occurrence for non-advisors to forcefully advise their bank customers, meaning they’ll have had no benefits from consumer protection. Speaking to a professional mortgage advisor in Sunderland will allow those benefits.
It is also important to remember that taking an appointment with a bank can sometimes take months to try and get yourself booked in for. A mortgage broker in Sunderland is often able to get you booked in within the same week, usually within that same day.
These kinds of issues is why the importance of mortgage brokers has grown and changed the public perception over time. More and more applicants rely on the mortgage brokers than before for help with their mortgage process.
There is now a lot more trust for the mortgage brokers in Sunderland, who are typically able to offer their mortgage advice services within the same day. Our dedicated team are always ready to help you, so get in touch and we will put you with an experienced mortgage advisor in Sunderland, as soon as possible.
You might be wondering what exactly causes some of the mortgage applications to be more difficult than many applicants expect them to be. Here are some of examples of this:
In years gone by, it was a lot easier for mortgage lenders to get ahead of their other competitors by laying out more enticing offers than the others have. Times have changed and it’s now more than the deals, it’s the criteria, that differentiates between the lenders.
To make everything easier for you, you should speak with an experienced mortgage broker in Sunderland and see if they have come across a similar situation in the past or not, as they may be able to utilise their knowledge from that to help you through yours.
After undertaking lots research and working very hard, a dedicated mortgage broker will hopefully be able to guide you through your journey and be able to recommend the most suitable mortgage for your personal circumstances.
Even if your mortgage application seems rather simple, it may still be beneficial to use the services of an experienced and knowledgeable mortgage broker, as we will work hard to get the best deal we can for you.
We have a professional and trusted mortgage advice team that will be able to provide guidance on other services such as solicitors. By getting in touch with us, you will also be updated you about the surveys and protection information that will be available to you.
A key feature of our service that we love to shout about, is how we’re more quicker and responsive compared to the other mortgage brokers.
One of the biggest reasons why customers tend to require help, is that everyone nowadays is very busy and needs someone to take the weight off their shoulders, doing the hard work for them.
Our dedicated and loyal mortgage advisors in Sunderland will do everything they can to make sure the process goes smoothly for you.
If you are ready to chat with a dedicated advisor about your mortgage plans, please get in touch with a mortgage broker in Sunderland. We are available from early until late, all throughout the week, to help you find the perfect mortgage deal.
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.
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.
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.
If you are looking to invest in another property that isn’t your current home, you are going to need to take out another mortgage. There are many different reasons why someone may want a second mortgage. Some people may even want more! It entirely depends on what the applicant wants.
Before you will be able to take out another mortgage, you will first have to pass the same affordability checks, credit checks etc., that you passed to qualify for your current mortgage. In order to understand why people may want to take out another mortgage, we have compiled a list to show how it can be made possible in both residential and buy to let scenarios.
Before you can take out another mortgage on a residential property, you will have to demonstrate that you can afford it. Lenders will need to see that you can not only afford one but two mortgages. Most people want a second residential home for a home away from home. They may use it for work, get-aways/holidays or for their family to stay in from time to time.
We have seen that some people may take out a second mortgage to purchase a home for a family member. This option isn’t as popular as people prefer to use gifted deposits over paying another mortgage off.
The problem that you may encounter when taking out a residential mortgage is that you can only live in one property at once.
You also cannot buy another property with a residential mortgage, with plans to let it out in the future. Buy to lets are taxed differently, therefore, this would be illegal.
Residential mortgages have high loan to value ratios. This loan is being secured against the property (or an asset). With this in mind, you usually cannot get another mortgage on the same property.
The only real exceptions would be if you took out a second charge mortgage or a further advance. A second charge mortgage allows you to borrow slightly more from your property with the same lender, and a further advance is the same but through a different lender.
Because you’re borrowing extra on top of your existing mortgage, you will have to pass various affordability checks before receiving the go-ahead. Depending on which product you take out and the rates that come with it, these could end up costing you quite a bit. Speak to a Mortgage Broker in Sunderland like us before taking out something like this.
Buy to lets mortgages are a little easier to work with if there is more than one. There are no real limits to how many buy to let properties you can have, which is why it makes it easier.
Qualifying for them can be difficult, however. You must consider that the more buy to let properties that you have, the more monthly repayments you are accountable for. Theoretically, they should pay for themselves, however, if your tenant moves out and you struggle to find a new one, you are accountable for the repayments. Lenders will check that you can afford this before they let you take out your new buy to let mortgage.
One issue that you may encounter could be the location of the property. Some lenders may be less willing to lend on a street where you already own a property. We have also seen that they may not be willing to lend on a property that is in the same area as one of their own buy to let properties. The reasoning for this is that if one of the properties goes down in value, they’re likely to be more affected by it.
Strictly, no. Living inside of a buy to let property is a breach of your contract between you and your lender. You may be fined for this and face legal action. If you want to turn your property into a buy to let, you will need to remortgage the property and take out a new deal suited to your needs. Before you do this, you should look into buy to let mortgage advice in Sunderland.
If you still have any more questions regarding residential and buy to let properties, feel free to get in touch with our team. We recommend speaking with a Mortgage Broker in Sunderland to get the best answer to your specialist questions.
Having one mortgage to sort out can be stressful enough, never mind another one! Our team at Sunderlandmoneyman are more than happy to help and we can’t wait for you to get in touch. Book your free mortgage appointment online or give us a call.
At some point in time, every homeowner will see their introductory period come to an end. If you are thinking the same way as most homeowners, you may be considering taking a remortgage out on your property.
If you are looking to learn more about remortgages in Sunderland, please feel welcome to watch our video all about taking out a remortgage, hosted by “Moneyman” Malcolm Davidson, on our channel MoneymanTV.
This will typically depend on what it is that you are looking to do. For a lot of homeowners, a remortgage in Sunderland is the next step that makes the most sense, as they look to improve their lifestyle or make the most out of their home, but it is not the right choice for everyone.
It is the job of a dedicated remortgage advisor in Sunderland to review your personal and financial situation, what all of your plans are, and see if this is the best possible plan of action for you to take.
We offer a completely transparent mortgage advice service, so if there is a better option out there for you, your mortgage advisor in Sunderland will let you know, and possibly offer up an alternative.
As is generally the case with any mortgage option, you will need to make some careful consideration and planning in advance. There are many different reasons as to why someone may look at taking out a remortgage in Sunderland once their introductory period has ended.
The most impactful reason in recent memory is because of a rise in national interest rates. Historically speaking, interest rates are much lower than they have been in previous years, so you may find that they are more likely to go up than they are to go down.
With this in mind, it may actually be more suitable you to remortgage in Sunderland as soon as possible, to fix in for a chosen amount of time, to take advantage of the current rate. People will usually opt for 2-5 year fixed rates, though you may be able to fix in for longer.
Doing this could potentially save you a lot of money in the long run, as the interest rate may have actually gone up during that time period, but you will still be paying the rate of interest that was available to you when you fixed in.
In other cases, it’s not necessarily because of interest rate rises, it could just be that you’d like to access better rates that may be available to you. Over time, there will be a build up of equity within your property, as well as the potential of your properties value going up.
The equity that is in your home can be used to get yourself a much better loan-to-value. This means much better interest rates, which could either contribute to saving you money, or reducing your mortgage term, depending on what you’d like to achieve.
On the topic of the equity that is in your property, other customers may look at releasing it via their remortgage in Sunderland, as a means to raise the necessary funds to cover the cost of any home improvements, modifications or alterations that they are planning to have carried out.
Whilst the mindset of many homeowners may just be to pack up and move for what they want in a home, for others, this is their home, they have grown in this building, perhaps raised or plan to raise a family in it. Because of these things, making modifications might be the best way forward.
We often hear of choices for doing this to include, for a newly refurbished kitchen, for a home office, to create an extra bedroom, more living space, a conservatory or maybe something else. This can then increase the value of your home, which can come in handy if you ever look to sell.
As you are going through your term, you may have gathered some unsecured debts against your name that have left the maintenance of your monthly payments to be quite challenging. Though it can be incredibly risky, taking out a remortgage in Sunderland to consolidate debt can be useful.
Doing so will see all of your unsecured debts combined into your monthly mortgage payments, as one single monthly outgoing. This free up disposable income and create less outgoings, though it will extend your debt over your mortgage, which will cost more on interest overall.
You should think carefully before securing other debts against your home. By adding your unsecured debts to your mortgage, which is secured on your home, you are potentially putting your home at risk if you cannot make the required repayments.
Although the total monthly cost of servicing your debt may have reduced, the total cost of repayment may still have risen as the term of your mortgage is longer than it may have taken to repay the debts originally.
Every now and again, we find that perhaps a remortgage in Sunderland is not best for a customer. That is why we would always recommend taking out remortgage advice in Sunderland before your introductory period ends, for you to speak with a mortgage advice expert and be advised on the right option.
Your mortgage advisor in Sunderland may feel that it is better for you to take out a product transfer, where you would take out a new mortgage deal, but stay with the same lender. If you’re looking to find somewhere that has more space, you may be better suited for moving home.
There may actually be more appropriate circumstances where your mortgage lenders Standard Variable Rate of interest could be your best option, though this isn’t something that is a frequent occurrence. This is because, typically speaking, your monthly mortgage payments will be more costly.
Homeowners over the age of 55, with a property that is worth £70,000 (whether they have a mortgage or not), may find it beneficial discussing equity release in Sunderland with a trusted later life mortgage advisor. They will help you to understand the pros and cons of lifetime mortgages.
Get booked in today in for a free remortgage review, by using our online booking feature. From there, a trusted and dedicated mortgage advisor in Sunderland will run through your situation with you, advising on what your best choices may be.
To understand the features and risks of equity release and lifetime mortgages, 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 repayable upon death or moving into long term care.
For every homeowner, there will come a time when your initial fixed period is coming to an end, and you will have the option of remortgaging your property. If you are not familiar with the process, remortgaging is basically a new mortgage taken out on the same property, to either replace the existing mortgage or borrow money against your home.
People can remortgage for a variety of reasons, such as raising capital, improving homes, and more. Another reason you may be unaware you can use capital raised for, is to purchase another property.
In some cases, some homeowners may have accumulated some extra money in savings to afford the deposit for another property. Though, any homeowner that has additional income during their mortgage term will more than likely put that towards paying off the remaining balance on their first mortgage.
Instead of this, we look at things like equity. Equity is the difference between the value of the property and the amount left on the balance of your mortgage. If there is enough equity in your home, you may be able to release some of this through a remortgage to finance the deposit of a new property.
Our team provides expert remortgage advice in Sunderland, while our mortgage advisors in Sunderland have a vast amount of experience in dealing with remortgages to release equity, so they will be glad to help you out.
Well, you might have enough equity, but would you qualify for an additional mortgage? As part of our service as a mortgage broker in Sunderland, one of our experienced mortgage advisors in Sunderland will carry out an affordability Check.
So long as you highlight what you are trying to achieve, your mortgage advisor in Sunderland will be able to let you know whether this is achievable. If your income and circumstances have not changed, you are highly likely to be able to remortgage. However, buying another property works a little differently.
The Financial Conduct Authority does not regulate some types of buy to let or commercial mortgages.
If you are looking at becoming a landlord and are in need of buy to let mortgage advice in Sunderland. Your mortgage advisor in Sunderland will perform some calculations and look at your potential rental income. When it comes to buy to let mortgage affordability it can be less about your income, and more about the potential rental income that the property could produce.
Flip side, if you are looking to buy a property for residential purposes, such as a second home for a legitimate reason (such as a home closer to your work if you commute, or for a family member) we will need to be sure that you can afford to proceed.
You will not be generating extra income from this property, so that is two lots of mortgage payments you will be covering out of your own income.
If you are looking at your options to take out a mortgage to buy another property, it is recommended that you talk to a specialist mortgage broker in Sunderland today. Book your free remortgage review of the mortgage today and a member of our dedicated team of mortgage advisors in Sunderland will run through your case and make sure you are able to proceed before you release equity from your home.
At the start of the Coronavirus pandemic, the Government promised that all borrowers would be allowed a three-month mortgage payment holiday if they needed it. Most lenders followed the Government’s guidelines and did their best to help their borrowers during these hard few months.
We have thought very carefully about what could happen to your mortgage over the next few months and are working closely with our panel of lenders to ensure that if anything changes, we can inform you right away and recommend the best option for you to take so that you still feel secure and comfortable with your mortgage.
Mortgage payment holidays are an agreement entered into with your bank, building society or mortgage lender to defer your monthly mortgage payments for a set period. In this case, 3-months.
It does not mean you never have to pay the amount back, but the interest you defer gets added back onto the loan amount, while your capital balance will not decrease. In other words, your mortgage amount will increase slightly, and you will continue to attract interest on the whole amount.
When you are ready to continue the payments, this could mean that either your monthly payments recalculated at a slightly higher level or your mortgage term increases to some extent.
Most lenders will probably prefer not to extend your mortgage term as this could take you past their standard retirement ages, but the detail on this will follow in due course.
Dependent on your mortgage deal, you may be able to pay off a lump sum later in the year to bring your mortgage back to where it would have been.
Mortgage Payment Holidays are available both for those with residential or buy to let mortgages in Sunderland, which means landlords also have assistance if rental payments are affected.
The full proposal is in detail below:
• Mortgage lenders will offer an automatic 3-month mortgage payment holiday for customers impacted, directly or indirectly, by COVID-19.
• The mortgage payment holiday will apply to customers who are up to date on their payments, not in arrears, and wanting to self-certify that COVID-19 impacts them.
• Meaning that lenders will not complete an income and expenditure assessment, or evaluation of alternate payment options as ordinarily required under MCOB.
• This proposal will allow lenders to be more responsive to customer needs and offer forbearance in a simple way to customers in an environment where COVID-19 also impacts the operation of collections teams made.
• Customers will be made aware that interest will accrue in the holiday period, and they will need to make up deferred payments in the future.
• Customers who wish to undertake a full assessment of their ability to pay or financial difficulty may still do so.
We would recommend speaking to your Mortgage Advisor in Sunderland. They will asses your financial situation first before looking to defer your payments as your situation may not yet be pressing.
Approaching a Mortgage Broker in Sunderland like us will allow you to explore all of your current mortgage options and could make things feel a lot less stressful.
For a customer, up to date with payments, not in arrears, and impacted by COVID-19:
• The customer would contact the lender and inform them that they are affected by COVID-19.
• The lender would accept these details from the customer and offer an automatic 3-month mortgage payment holiday.
• No evidence will be sought from the customer.
• The lender makes the customer aware that interest will accrue and will be contacted at the end of the three months to complete an assessment of the customer’s circumstances.
• At the end of three months, an arrangement to pay will be agreed with the customer according to their circumstances to recover any shortfall, while ensuring that the mortgage remains affordable and sustainable.
• The lender notifies the customer that if they wished to complete a full assessment now, there might be other forbearance options more suitable to the customer.
In some cases, a mortgage payment holiday can harm your credit score, but most lenders have now said that for matters linked to the virus, they will ensure that this is not the case.
You must ask this question to your lender directly and record the response, including the date and the name of the person you are speaking to avoid confusion later. Different lenders are doing different things.
At first, everything seemed like it would remain the same, and you would still be able to make changes to your mortgages as usual. Leading to a change over in the last couple of days, and lenders have been asking borrowers to avoid making changes while you are within a mortgage holiday period. So, at the moment, they are not allowing mortgages and product transfers.
Borrowers nearing the end of their existing product could get compelled to move on to the higher lenders variable rate, which means that borrowers who act too early could find themselves on a mortgage payment holiday that accrues interest on a costly variable rate.
We would highly recommend speaking to your Mortgage Advisor in Sunderland, and they will determine the best course of action based on your personal and financial situation. If possible, arranging your mortgage transfer first then asking for the holiday would seem to be the most sensible way forward.
At the moment, no Lenders have withdrawn mortgage offers; in fact, some are extending offers past the standard six-month expiration date.
You should not pull out of your purchase unless, for example, you are worried about losing your job as a result of Coronavirus. We are advising everyone to proceed as usual for now and “wait and see” – you are not committed to completing your purchase until contracts get exchanged.
In some cases, lenders can offer you a temporary switch to interest-only to reduce your monthly payments but not to add any further to the loan amount by still servicing the interest payments each month.
It may not be necessary to convert all your mortgage to interest only, and it may be that putting part of the mortgage on this basis could give you the breathing space you need.
People with savings may find that remortgaging onto an offset basis could give them a helping boost they were looking for, and they will be cutting down on their monthly payments while keeping hold of their savings.
For example, someone with a £400,000 loan and £100,000 in savings would only pay interest on £300,000. Meaning their monthly mortgage payments will massively be reduced.
For others, a straight remortgage to another lender, calculating the cost of any early repayment charges, may well be enough to ease the burden or simply extending the term of your mortgage.
If you still have any other questions on mortgage payment holidays or just want general Mortgage Advice in Sunderland, give us a call today. We want to help you and your mortgage journey through these tough few months ahead. Speak to an experienced Mortgage Advisor in Sunderland today.
This article was originally published on 30th March 2020 and as of the 20th May 2020 the property market has now resumed and this information has become outdated. Everything was 100% accurate at the date that this article was published.
The mortgage market has endured thanks to the coronavirus. Everything has come on a bit fast, and we thought we should catch you up to speed.
Our intentions aren’t to scare you, but explain what has happened to the mortgage market and do our best to help you through the problems you may face during these difficult times.
The central dilemma for the mortgage market is that surveyors and mortgage valuers can’t go out and visit properties because the whole property market is on hold. Lenders need to know what they are lending against, so require some sort of valuation before accepting your application.
Some lenders rely on AVM’s (Automated Valuation Model) for valuations on a property. The reason being it’s a way for lenders to receive an estimate without actually going out to the property.
However, when they don’t need to send someone out to look at the property physically, these types of mortgages get restricted and to lower loan-to-values only.
During the last couple of days, as of March 28th, some lenders have been restricting their maximum loan-to-value down to 60%. So, they are continuing to process these types of applications but not necessarily ones at higher loan-to-values.
Each lender is taking a different approach. So far, no mortgage offers got withdrawn, and we think that it is just a waiting game at the moment, lenders are just putting everything on hold before rushing into accepting more mortgages.
We have whiteness that some lenders have decided to extend the periods of their mortgage offers from six months up to nine to allow the economy and the mortgage market to get back up and running again.
Following our recent article about Mortgage Payment Holidays, we want to remind you that you should only take one if you need to. Do your research, talk to a Mortgage Advisor in Sunderland, evaluate your options, and see whether it is the right thing for you.
It is more than likely that they will extend the period of your mortgage anyway, so it could be better just to hold off. You should contact your lender if you are questioning your ability to meet your monthly mortgage payments.
If you decide that this is your best option, lenders are asking for you to get in touch online due to the sheer volume of calls they are receiving.
If you are going to request a payment holiday, check that it won’t affect your credit rating or mark any arrears against your account. Also, don’t just cancel your direct debit and remember that you will need to seek permission from your lender to take a payment holiday.
The main thing is not to panic. We are here to help you with all of your mortgage problems and get you and your mortgage through these next couple of months. At some point in the coming weeks or months, someone is going to press play again.
We will all be back to normal in the given time. You can still get in touch with a Mortgage Advisor in Sunderland 7 days a week. Business is as usual. We can’t wait for you to get in touch and help you with all your mortgage needs.
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Authorised and Regulated by the Financial Conduct Authority.
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Sunderlandmoneyman.com & Sunderlandmoneyman are trading styles of UK Moneyman Limited, which is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited is Registered in England, No. 6789312 | Registered Address: 10 Consort Court, Hull, HU9 1PU.
Authorised and Regulated by the Financial Conduct Authority.
We are entered on the Financial Services Register No. 627742 at www.register.fca.org.uk
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