Michael Sallabank, Author at Leedsmoneyman

Should I Remortgage in Leeds?

For everyone who owns a home, there will be a point in their life, during their introductory period, where that deal will come to an end. If you are thinking in a similar vein to other homeowners, you might be considering taking out a remortgage on your property.

If you would like to learn more about remortgages in Leeds, please feel free to read the various mortgage guides we have on this topic. Alternatively, you might benefit from listening to the “Moneyman” himself, Malcolm Davidson, talking all about remortgages in Leeds.

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Is remortgaging right for me?

This will depend on what you are hoping to achieve with a remortgage in Leeds. For a great deal of homeowners, taking out a remortgage in Leeds is the next step that makes the most sense, on the road to improving their lifestyle or making the most out of their home. That being said, it isn’t for everyone.

The purpose of a dedicated remortgage advice team in Leeds is to review your circumstances, what it is you are looking to achieve, and see if this is the most appropriate route for you overall.

We offer a completely transparent mortgage advice service, so if a remortgage in Leeds isn’t right for you, your mortgage advisor will let you know and offer a potential alternative.

Why do people remortgage in Leeds?

As is usually the case with any mortgage option, there will need to be a large amount of careful consideration prior to making any decisions. There are lots of reasons as to why a homeowner may look to remortgage their home once their introductory period has ended.

To Avoid Any Increases in Mortgage Payments

One of the biggest reasons in recent memory is because of a rise in interest rates. Based on the history of them, interest rates are a lot lower than they previously were, so you are much more likely to see increase than a decrease.

With this in mind, it may be a lot better if you take out a remortgage in Leeds as soon as you are able to do so, fixing in for a specific duration, so that you are able to take advantage of what rates are like currently. People typically choose a 2-5 year fixed rates.

In some cases, you can choose a longer fixed term. A fixed rate could save you a lot of money over the course of it’s duration, as the interest rate may have risen whilst you are fixed, though you will still be paying the lower rate of interest that was available when you took it out.

For a Better Rate

In other situations, it’s not because the interest rates are going up, but instead because you want to access a better rate that could be eligible for. As time goes on, equity will grow within your property and your property may have potentially increased in it’s value.

The equity that is within your home can be used as a means of accessing a better loan-to-value. This can mean getting much better rates, which in turn can allow you to save money or to reduce your term length, if you would like to do this.

For Home Improvements

On the topic of the equity sat within the property, other customers may look to release equity through a remortgage as a way to raise the necessary funds to cover the cost of any home improvements, modifications or alterations they are planning to make.

Whilst some may just have the mindset of simply moving home for what they want in a home, for many, they have built a life in this home, potentially raising or having plans to raise a family in it. Because of this, they may need to alter it to fit their needs.

Reasons that frequently occur include for a newly refurbished kitchen, to create an office for working from home, an additional bedroom, more living space, a conservatory or something else. This in turn can increase the value of your home, which is handy if you ever want to sell it.

To Consolidate Debt

Throughout your term, you may have gained a portion of unsecured debts against your name that have left the process of keeping up your payments a bit challenging. Though it can be risky, a popular choice amongst homeowners is to take out a debt consolidation remortgage in Leeds.

This type of process will move all of your unsecured debts into one combined monthly mortgage payment. Whilst this gives you more disposable income per month, with less outgoings, it will extend your debt over your mortgage term, which will cost more 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.

Alternatives to a Remortgage in Leeds

For some homeowners, a remortgage in Leeds may not be the best choice. Because of this, it is always beneficial to take out expert remortgage advice in Leeds ahead of your fixed period ending, to find the best possible route for you to take.

Your dedicated mortgage advisor in Leeds may feel like it is better for you to take out a product transfer, where you would take out a new mortgage deal, but with the same lender. If you’re in need of more space, perhaps moving home would be more suitable after all.

In rare situations, it may actually be best for you to move across onto your mortgage lenders Standard Variable Rate of interest, though this occur often as it will most likely be much more costly for you on your monthly mortgage payments.

If you are aged 55 and over, owning a property that is worth £70,000, it may be beneficial for you to discuss your equity release options with a qualified later life mortgage advisor in Leeds. They will be able to discuss your lifetime mortgage options, explaining to you the pros and cons.

Get booked in for a free remortgage review today by utilising our online booking feature. A dedicated and trusted mortgage advisor in Leeds will take a look at your circumstances, providing you with expert clarity on which option will be most appropriate for you.

To understand the features and risks of an equity release in Leeds 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.

Why Should I Use a Mortgage Broker in Leeds?

The Benefits Of Using a Mortgage Broker in Leeds

Why use a Mortgage Broker? | MoneymanTV

We firmly believe that there are many positives to taking on the services of an expert mortgage broker in Leeds, more than there would be to going direct. That’s just our opinion though, of course we’d say that!

In reality, there are positives to going elsewhere, so it definitely is worth exploring your mortgage options. Thankfully for us, the majority of people will opt to speak with a mortgage broker in Leeds. That being said, we will take a look at the pros and cons of both routes.

Mortgage Broker in Leeds vs Going Direct in Leeds

The first tick in the column of Team Mortgage Broker is that whilst most high street banks can be approached directly, not all mortgage lenders can be.

This means that to get the best deal across all lenders, you’ll benefit from speaking with a mortgage broker in Leeds, though a mortgage lender may still have some deals you cannot get going to a mortgage broker.

An experienced mortgage broker in Leeds will typically require a fee, whereas this likely won’t be the case when going direct. That being said, we can help to recommend other services that you’ll need for much cheaper than they might be with a lender.

Previous arguments could be made saying that “the bank manager knows my finances inside out,” but this was a nullified argument once credit scoring was introduced.

If you know what you are doing and what you are looking for, going direct can be a quick and easy process. On the other hand, if you do not know what you are doing, you could harm your chances of ever obtaining a mortgage, as you won’t match all lenders criteria.

A trusted mortgage broker in Leeds will be able to review the different lenders mortgage criteria and will be able to match you up with the most suitable mortgage deal. We always aim to get this recommendation right first time, which more often than not, we do.

Mortgage Advice Past vs Present

In days gone by, mortgage advisors from high street banks would approve you for a mortgage, whether they were adequately qualified or not. You would not benefit from correct mortgage advice or consumer protection.

As 2014 arrived, this type of practice was banned by the government. Only experienced mortgage advisors could go about providing mortgage advice to customers, making recommendations for products.

The downside to having to now having to only speak with specific individuals at a bank, meant you could be waiting months, just to speak with someone. That’s not good if you’re keen to get it done quickly!

Because of this, usage of a mortgage broker in Leeds rose, becoming a much more popular option. As a company ourselves, we offer various time slots throughout the week, allowing you to pick a time that is convenient to you, and not months in advance!

Quite often, if you’re lucky when booking your free initial mortgage appointment, you’ll be able to speak with someone the same day.

Modern Day Challenges

Nowadays, the hardest part of the mortgage process is matching up against the right mortgage lenders criteria. It’s also important to remember that deals with the lowest rates often have higher arrangement fees.  

At the end of the day, a deal may be really good, but you’ll need to pass affordability checks and be eligible for that deal in the first place. With the help of a mortgage broker in Leeds, you’ll be able to find deals that are suitable for you.

Newer Regulations

Thanks in part to the regulations that followed after the credit crunch back in 2008, mortgage applications perhaps are not as straightforward as they used to be.

This isn’t necessarily a bad thing, however, as it makes for fairer lending and less chance of anyone falling into arrears, which both customers and mortgage lenders alike would much rather do without.

That being said, there are still a handful of situations that could cause some issues for applicants, of which a mortgage broker in Leeds may be able to help with.

  • You have a poor credit history.
  • You are receiving a self-employed income.
  • There is a mixed deposit source, i.e. Gifted & Savings.
  • Opting for Let to Buy. Renting your current home to buy another.
  • Being a contractor or working under a zero-hours contract.
  • You perhaps can’t quite meet affordability requirements.

Lending Criteria

Over our time as an expert mortgage broker in Leeds, we have seen mortgage lenders demonstrating their competitive prowess, trying to offer better interest rates than their fellow mortgage lenders.

Once again because of the changes to regulations, the other difference between these lenders, is their mortgage lending criteria and whether or not the customer can match up with it.

Examples of how these may differ, is that some mortgage lenders may have more products for self employed applicants than others, whereas others may not but will be more lenient to something like bad credit mortgages.

The Benefit of a Mortgage Broker in Leeds

Whatever your situation may be, it is unique to you. When you get in touch with a mortgage broker in Leeds and discuss your case, we may have encountered something similar before and will use that knowledge to help.

As a part of our service, we aim to go above and beyond for every customer who gets in touch with us. Customers rely on our help, so even if it seems relatively straightforward as far as cases go, we will still give it our absolute all.

During your process, one of our mortgage advisors in Leeds will be able to discuss what your budget is for making an offer on a property and recommend additional services such as trusted solicitors and the right property survey to undertake.

They can also run through any potential insurance options with you, helping prepare you and your family for the future, in the event of anything unfortunate occuring that could hinder your families financial state.

Still, need more convincing?

A further aspect of our service that is worth shouting about as a mortgage broker in Leeds, is how responsive we are to our customers. Oftentimes going direct can leave you unsure of what is going on and not always being able to make contact.

Our trusted mortgage advisors in Leeds will always keep you in the loop, with availability from early until late, every day of the week, responding as soon as they possibly can, no matter what you need them for.

Additionally, an overlooked factor as to why people may prefer the services of a mortgage broker in Leeds, is that nowadays people just seem to be so busy. It’s often easier to use a professional service, to take the stress off your shoulders.

This is especially beneficial for professional applicants who are dealing with customers of their own, perhaps not having the time to run through their process themselves.

Book Your Free Mortgage Appointment

If you would like to go direct, that is great! Generally though, whether a customer is a First-Time Buyer in LeedsSelf-Employed in Leeds, or looking to Remortgage in Leeds, they prefer to enlist the services of an expert mortgage broker in Leeds.

Book your free mortgage appointment today with a fast & friendly mortgage broker in Leeds and we will see how we can help you along your mortgage journey.

Can I Change My Mortgage to Buy to Let in Leeds?

The Financial Conduct Authority does not regulate some types of buy to let or commercial mortgages.

Depending on the situation that you are in and the mortgage lender you have a mortgage with, yes, you can convert your existing mortgage into a buy to let.

After being a homeowner for a while, you may want to switch things up. Perhaps you will be living with a friend or partner, who owns a home? Perhaps you want to live somewhere new? Occasionally, homeowners may wish to go back to renting.

In either of these circumstances, you may wish to hold onto your current home, turning it from a residential property, into a buy to let property, going from just a homeowner, to a landlord as well.

This is something that can be quite beneficial for many, as it will supplement your income over time.

How to change your mortgage to buy to let in Leeds?

If you wish to make a change to your mortgage and make it a buy to let in Leeds, the first thing you will need to do is speak to your mortgage lender to make sure this is something you can do. If they confirm you can, you’ll need to get in touch with a mortgage broker in Leeds.

The reason is because in order to switch, you will need to remortgage onto a new type of mortgage. Whether you stick with the same mortgage lender or find a new one, one of our expert mortgage advisors in Leeds will help find the best deal for you.

It will be a remortgage, because you are modifying the terms of your deal. You signed up to a residential, not a buy to let, so this will be updated. It isn’t as straightforward as asking the lender to switch, as you need to pass their mortgage criteria for a buy to let in Leeds.

What criteria do I need to meet to change my mortgage to buy to let in Leeds?

First and foremost, before anything else you’ll typically need to have remained within your property as a homeowner for at least six months. Once you’re past the six month point, there are all kinds of factors that a mortgage lender will consider.

Affordability

Your affordability is something that entirely depends on the rental potential of the home you’re converting. Most lenders will want to stress-test your property to make sure that you are able to cover at least 125% of what you’ll be paying per month.

Equity in Your Home

Whilst technically you won’t need a deposit to take out this new mortgage, you will need to have a sufficient amount of equity sitting within your property in order to be able to remortgage it onto a buy to let in Leeds.

Lenders will want to see that you have at least 20-25% equity in your property, though this can be more with poor credit history. Chances are you’ll need even more than this, in order to also cover the deposit for a new home to live in.

Credit History

If your credit history is pretty poor, your chances of obtaining a mortgage will be slimmer. That being said, it’s not always impossible for you to do so!

There are plenty of mortgage choices out there for bad credit mortgages, which extends to people wanting to do a buy to let in Leeds. If any new credit problems have cropped up since your initial mortgage, obtaining a buy to let mortgage may be more challenging.

The important things to remember are building up your credit score again and the amount of time that has passed since the initial issues cropped up. To give an example, the more time that has passed since being given a CCJ, the better chance you’ll have of getting a mortgage.

Type of Property

The type of property you are letting out can have an impact on your mortgage process. You’ll find it more limited if you are looking to take out a mortgage on a HMO or Holiday Let, as they are specialist areas that require the assistance of a mortgage broker in Leeds.

Landlord Experience

Some landlords won’t offer mortgage products to first time landlords. If you have been a landlord in the past, you will have access to a wider variety of mortgage deals with more mortgage lenders.

On the other hand, there are multiple mortgage lenders that we have on panel, with some of these offering products to first time buy to let landlords. To learn more, speak with a mortgage advisor in Leeds.

Can I live in my buy to let in Leeds?

No, you are not allowed to live in a property that you have a buy to let mortgage on. This would is a breach of your mortgage agreement and will very likely have a large negative effect you and your home.

Letting Out Your Current Home to Buy a New Property in Leeds

Alternatively to a buy to let in Leeds, you could let out your existing home as a way to buy a new property to live in. This process is called let to buy. It is popular amongst homeowners who wish to supplement their income and also live somewhere else.

This works the same as a typical buy to let, though you’ll be applying for two mortgages this time (one to convert your property into a buy to let and one to buy a new home. As such, your lender will need to confirm you can afford both of these.

How many buy to let mortgages can I have?

Whether you’re a new landlord planning ahead or an existing landlord ready to expand upon your property portfolio, you may be wondering how many times you can have a buy to let in Leeds.

Whilst there isn’t necessarily a strict limit on how many buy to let mortgages you can have, it will depend on the risk to the lender as to whether or not you’ll be able to take out further buy to let mortgages. Speak to a qualified buy to let mortgage advisor in Leeds to learn more.

Could consent to let be an option?

Some homeowners may have the option of accessing something that is called a consent to let. This is typically something used more in the short term, with your home only being a temporary buy to let.

Depending on lender, you will usually have a limit that is between 30-90 days per calendar year. You need to check with your lender beforehand, to make sure you are able to do this.

Speak to a Qualified Buy to Let Expert in Leeds

To gain a further understanding of the options available for making your home a buy to let in Leeds, book your free mortgage appointment and speak to a mortgage advisor in Leeds.

A dedicated member of our team here at Leedsmoneyman will be able to review your circumstances and inform you of the deals you may be able to access, as well as helping with any additional buy to let mortgage advice in Leeds you require.

A Guide to Remortgages in Leeds: Top Reasons to Consider

Remortgage Broker in Leeds

You may find that going into the mortgage journey will prove to be rather fruitful. It can have both its ups and it’s downs, though regardless, you will end up with one potential outcome once your term ends.

You’ll either have a home that you have been able to settle down in, an initial property that you can use to propel yourself up to a better property, or a property that you can invest in to boost your income.

No matter which route you went down, you’ll eventually reach the point where your term comes to a close and you’ll need to look at your options. Some people look to sell their home and upsize/downsize into a new property.

Others may sell their portfolio to the tenant or another buyer, with a view to look alternative ventures. However, we mostly find that people choose instead to Remortgage their home.

What is a remortgage?

First of all, let’s take a look at what a Remortgage actually is. A Remortgage is basically where you take out a new mortgage to pay off a mortgage that you already have. There are a wide variety of different options when taking out a Remortgage, some of which are minor, others of which are major.

By using over two decades of mortgage industry knowledge from the “Moneyman” himself, Malcolm Davidson (host of our YouTube channel MoneymanTV), we put together a useful Remortgage guide for those looking at what they can do next, when their term nears its end.

Remortgage for Better Interest Rates

The mortgage deal that you start on will typically last around 2-5 years and feature low fixed rates, with the rates potentially discounted. Sometimes though you may find that you’ve been placed onto a tracker mortgage, which will follow along with the Bank of England’s base rate.

Once your term comes to an end, it’s likely that you will be put onto the lenders Standard Variable Rate (this may be shortened to SVR). To explain what this is, an SVR is a mortgage that has an interest rate that may change depending on the amount that your lender wants to charge for it.

The Standard Variable Rate will not follow the Bank of England’s base rate like you would see with a tracker mortgage.

Because of this, SVR’s are generally perceived to be the most expensive paths that customers could take, leaving many to instead take a look at Remortgaging to open themselves up to better rates, something which may hopefully save you money on future monthly mortgage repayments.

Remortgage for Home Improvements

Once you’ve gotten about 2-5 years into being a homeowner, you may feel like something needs to changed. Some people might want an extra room or much more living space, possibly a new kitchen, a new office to work from home in, or even a new loft conversion.

Rather than find a bigger home to move into, a lot of homeowners instead look at releasing their equity with a Remortgage, so that they can cover the costs of home improvements.

Obtaining planning permission and both funding and managing your own project can seem quite stressful. Some other homeowners would say that it is less stressful and a lot more rewarding than it would be trying to get a new home, selling your current home and moving everything between properties.

In the long run, you may be able to reap even more benefits, as opening up lots of space within the property and having a top level of craftsmanship will very likely increase how much the property is worth, which is useful if you ever decide you want to sell your property or make it a rental.

Remortgage for Changes to Your Term

Sometimes you’ll find that people are looking to Remortgage in Leeds so that they can gain access to a better mortgage term, whether this be achieved by reducing the length of the term or switching to a more flexible mortgage product.

By reducing your terms length you’ll be cutting short how long you pay back your mortgage for, so aren’t tied down, though it does mean that your monthly repayments will be higher. The longer you set your term for, the lower your payments will be.

Some homeowners may choose to take out a more flexible mortgage term when they look to remortgage. They may do this due to the amount of benefits they may have for doing so.

In having this mortgage, you may be able to overpay, meaning you could pay your mortgage off a lot quicker, as well as being able to take the same mortgage and rates with you across to another property, if you ever do decide to move.

You might feel like a flexible mortgage sounds near perfect, though they tend to be tracker mortgages, which as we said before will follow the Bank of England base rate. This means your payments could differ depending on interest, which some may think is unreliable.

Remortgage to Release Equity

Everyone will have some amount of equity existing within their property. The amount can be worked out by looking at the difference between what is left on the mortgage and how much the property is currently worth.

As talked about before, the equity can be used for home improvements, though you can use it for more than that too. Some use their equity to cover long-term care costs, to boost their income, to go on holiday, to pay off an interest-only mortgage or to just give them some spare money to spend.

Occasionally, we see Buy-to-Let landlords using a remortgage to release equity as a way to cover their deposit for buying any future property portfolio additions.

If you are aged 55+ and own a home that is valued at a minimum of £70,000, it may be worth your time looking at your options for Equity Release in Leeds. Get in touch with a qualified later life mortgage advisor to learn more about later life lending.

Remortgage to Consolidate Debt

Whilst speaking of Equity Release, we also find that there are a lot of people who will pay off any unsecured debts that you may have gained over time.

Though it may seem like a really straightforward process, Debt Consolidation not only factors in the amount that you owe for your debts and how much the property is worth, but also the state of your credit rating. This means the amount you could borrow is limited.

On top of this, in order to pay off your previous mortgage and your debts, you need to borrow a much higher amount than your mortgage, making your monthly repayments much higher. Though it isn’t great, at least you know there are some options should these problems arise.

If you have a damaged credit rating, there are still options out there for you, though these aren’t easy and require very Specialist Remortgage Advice in Leeds before you go ahead with these. Even with those options, you’re not guaranteed to get a mortgage.

It is always recommended that you get mortgage advice before you look to consolidate and secure any debts against your home.

Experienced Mortgage Advisors in Leeds – Get in Touch

If your mortgage term is coming to an end and you would like to learn more about your Remortgage options, we definitely recommend getting in touch with an experienced Mortgage Broker in Leeds and booking your free mortgage appointment.

A dedicated mortgage advisor will take a look at your situation and look at your future goals, in order to help you to determine the next step of your mortgage journey. We aim to ensure that your mortgage process this time around is a lot smoother and quicker than it was before.

How Much Deposit Do I Need to Buy a House in Leeds?

How much deposit will I need to save?

The minimum deposit amount that will be required for a deposit on a property is 5% of its value. Depending on a variety of factors, such as credit history, house type, and location, it may exceed this amount.

It can also depend on what you want to achieve. Maybe you’re buying your first house? Perhaps you are an existing homeowner looking to take on or convert your home into a buy to let. You might even be looking to use a government scheme, such as Help to Buy in Leeds as a means to get onto the property ladder.

Everyone has a different situation, so it is important to know in advance the amount of deposit you may need for what you want.

Why do I need a deposit anyway? 

Pre-credit crunch, mortgage lenders were handing out mortgages to people who could not even afford one, some even without a deposit. As you may know, the mortgage market crashed in 2008 and was not back to prominence until 2013.

It is for this reason a mortgage lender will now absolutely require a deposit from a home buyer, to provide some level of security, proving their borrower is reliable and can afford the repayments.

The latter is also why some applicants may find that their minimum deposit requirement is much higher because of poor credit and a potential history of unreliability. You may still be able to get a mortgage in this case, but it will certainly prove more complex and require a much higher deposit.

Assume that you have a good credit history, and your credit score is a high number, you are highly likely to have access to a 95% mortgage with only a 5% deposit. If your credit rating is not the best, you may expect a 10% – 15% minimum, or higher.

Will the government pay the deposit for me? 

While the government will not “give” the funds for your mortgage deposit, they may be able to help you put down the deposit or one of the various other mortgage schemes that could be available to you.

You can access different schemes. From the Shared Ownership Scheme, Armed Forces Buy Help, Lifetime ISA, and more, one of these government schemes could be the key to finding the success of a mortgage in Leeds.

A different scheme that could prove useful is the Right to Buy Scheme. This allows tenants to possibly purchase their rental property from the landlord (typically council or housing association), at a discounted price. Because of the equity in the property, you usually do not need to put down a deposit.

I have 5% deposit, is that enough?

A 5% deposit with a good credit score may be enough for home buyers to make standard purchases. However, mortgage lenders with the “best” deals for you may have higher minimum requirements, so it may be worth saving more than this.

Also, putting down a higher deposit will open you up too much better deals anyway, allowing you to choose a shorter term or reduce the cost of your monthly mortgage payments.

However, it is important to note that you still need to prove that you can afford a mortgage. You could have saved at least a 5% deposit, even higher, but if your income shows that you cannot meet monthly mortgage payments, you can still be rejected.

My credit history is poor, how much do I need to put down? 

As mentioned above, if you have a bad credit history, you can use the minimum deposit requirement for about 10%-15%, potentially even higher.

In addition to this, you may also only have access to specialist mortgage products. It is here where we recommend taking out specialist mortgage advice in Leeds. This allows you to talk to a mortgage advisor in Leeds who can recommend the most suitable course of action.

What about buy to let?

You will require a slightly higher deposit if you are purchasing a buy to let in Leeds. It was always like this; it is usually anywhere between 20%-40%. As a mortgage broker in Leeds, we tend to find most high street lenders are asking for a minimum of at least 25%.

There are a few factors that can help you get a mortgage purchase. An example of this is that if you have already built a purchase to allow the portfolio, lenders may be more likely to lend to you.

Can I take out a loan for the deposit? 

In some cases, you may be able to do this, though generally speaking it will not be acceptable. A mortgage lender will very rarely accept a deposit funded by a loan because you will be paying back 100% of your mortgage. For more information, we recommend that you talk to a specialist mortgage advisor in Leeds.

A mortgage broker in Leeds like us is available 7 days a week, so if you have any questions, contact us, and book your free mortgage appointment to speak to an expert mortgage advisor in Leeds today.

Can someone gift me a deposit? 

Mortgage lenders always provide an incentive for gifted deposits as they are a wonderful way for first time buyers in Leeds to find their place on the property ladder. Gifted deposits are, as the name suggests, a deposit that is given to the applicant by a family member or friend.

You can use this gift if you can prove where the original funds came from. The person who has given you the deposit will also have to confirm in writing that it is not a loan, it is purely a gift.

Are there any circumstances at all where I don’t need a deposit? 

There are only a handful of different situations where you won’t need a deposit for a mortgage. Such as if you were buying as a sitting tenant at a discount from the open market value, buying from family member, or as mentioned above, with a Right to Buy mortgage. 

Leasehold House Mortgage Advice in Leeds

Help to Buy Mortgages in Leeds

Following on from the Help-to-Buy Scheme, many builders started selling houses on a leasehold basis when traditionally homes had always been sold on a freehold basis. Over time this became a hotly debated topic, of which the Government eventually felt the need to step in.

Some of the country’s home builders had fingers pointed at them for putting profits before their social conscience. Whilst they were aware that they needed to build homes for families, they also have to answer to the shareholders.

Land Banking

The media has been very vocal about the fact that there have been situations with land banking. Land banking is a property investment scheme that involves buying vast amounts of undeveloped land with a view to selling the land when it has been approved for development and is more profitable.

Thanks to consolidation, some builders have inherited land into their companies which is on a leasehold basis. Many debate that they should offer both leasehold and freehold properties for sale, so that buyers have the ability to choose the route they’d like to go down.

What About the People?

Many people felt that the market had been heading too far into the territory of leasehold, especially when it became public knowledge just how much profit the builders were making from their leases.

Things drastically changed, when the Chief Executive of one of the UK’s most noteworthy Builders received a bonus of over £100,000,000. At that particular time, this was one of the most significant premiums paid in the history of a corporation.

Some Leasehold Homeowners were shocked when they found themselves being quoted thousands of pounds in fees, even if it was only something like seeking permission to make small alterations to their homes.

These high end fees were being charged by their Leasehold Management Companies. Some of the annual ground rents were set to double every decade and owners could see that selling their home in the future once these increases have kicked in would be a very difficult process to undertake.

In Parliament

After homeowners notified their MP’s and the subject being heavily debated in Parliament, the Government agreed that if you were buying a house (flats or apartments excluded), then it is entirely reasonable that you should own the freehold.

What can you do?

If you happen to find yourself in this situation, owning a leasehold houses and you weren’t aware, then you absolutely should have been made aware.

If you feel that the Solicitor acting for you did not give you a more thorough and complete analysis of what the lease you signed entailed, you should re-contact them immediately to investigate why this was the case. You can contact the freeholder at any time if you are interested in buying the freehold from them.

Service Charges

The costs of the service charges may very well go up. Sometimes the residents in the area can group together to form an association, which can give them the collective freedom to choose a different service provider. If you are considering buying a leasehold property, take advice from your Solicitor regarding the lease.

It’s so very easy to get carried away with the excitement of purchasing a home, but you also need to realise it’s a significant investment decision and something that you need to think about very carefully.

If you would like advice regarding something like this, please do Get in Touch and we’ll see how we may be able to help you.

A Guide to Buying a Property in Joint Names in Leeds

Purchasing a Property in Joint Names

Over the years, we have seen property prices increased at a far faster rate than wages have. Through speaking to many customers, we have found a common occurrence, in that many people look to purchase in joint names with a partner or friend, as a means of being able to afford a suitable home at a more reasonable price.

Purchasing in joint names will usually increase the maximum capacity of what you are able to borrow, as the lender will look at all parties income, rather than just one, taking this into account when running calculations on affordability.

How Many People Can Co-Own a Property?

We have known and we do work with some lenders who will accept up to four people as co-owners of a property. If throughout the duration one of the co-owners of the property decides that they would much rather not contribute to the mortgage repayments, any of the other joint owners will still have the legal right to reside in the property, unless this is ruled otherwise by a court.

If you would like to increase the mortgage amount later down the line, you must gain full consent from all your fellow co-owners. It’s therefore essential that you make long term plans with each other, discussing what you’d like out of this, so you can stay on the same page and avoid future disputes if you end up wanting something different.

Joint Tenancy or Tenancy in Common?

Commonly, for married couples or those still in civil partnerships, a ‘Joint Tenancy’ is something we have seen customers choose quite often. With this type of tenure, if for some unfortunate reason one of the party were to pass away, the property would be handed over to the other owner of the property. If you have taken out relevant life insurance, at this point, your mortgage would be covered and repaid.

With ‘Joint Tenancy’, you would still need all owners of the property to agree if you decided you wanted to Remortgage later down the line.

If choosing to purchase with relatives or friends, we find that ‘Tenants In common’ is the most popular route that customers take. You will still remain as a co-owner of the property, along with your cohorts, but you also have the flexibility to do this without the need to have completely equal shares. This works well if one party is making a more significant financial contribution than the other, as you could split the shares, for example if there were 3 of you, 60%, 30%, 10%.

With ‘Tenants in Common’, another positive aspect for the co-owners is that you have the freedom to act independently. An example of this, is that you can then choose to sell or give away your share of the property to someone else, without the need to consult with your fellow co-owners

Do I have to pay the mortgage if we separate?

All mortgage borrowers are jointly and severally (responsible for their own decisions) liable for mortgage payments. IF at any point in the future you find yourself paying all of your mortgage payments without a co-owner, you will still be liable to prevent the mortgage from falling into arrears.

This is because mortgage arrears showing on your credit file could have the potential to stop you from obtaining a mortgage at any point in the future. The best way to think of it is like this: You don’t own 50% of a property, you own 100% jointly.

How do I remove my ex-partner from a Joint Mortgage?

When purchasing a home with a partner, it’s a whole new chapter starting in your life and can be a great way to start fresh with another individual. In all the excitement of moving home, it can make you wonder about what will happen if things go a little wrong.

The primary thing to remember is that lenders will always need to have the utmost confidence that you can keep up with monthly payments on your own before they will approve you removing a partner and taking on the mortgage alone. As seen from above, a mortgage is a big financial commitment and making changes is going to be a challenge.

If you are able to prove that you can maintain mortgage payments following on from your partner leaving, the lender may agree to your request to put the mortgage into your single name. However, lenders like the idea that there are two people to pursue in the event of arrears occurring. To remove someone, they will carry out a brand-new affordability assessment, just like they would’ve done originally at the point of purchase.

Whilst a lender may not always accept a request, it’s always beneficial to speak with a mortgage advisor in Leeds prior to taking this route, as there may be other lenders who could agree to your transfer request.

It can also be worth talking to family members to see if they can help you out to make your financial and personal life a little easier. They can do so by replacing your ex-partner on your mortgage or by gifting you a lump sum, in a bid to reduce the amount owed. This will hopefully mean that your savings are able to contribute to easing your future mortgage payments.

Can I Remove My Name From a Joint Mortgage?

If you and your partner split up and you leave the family home, then your responsibility is still shared for mortgage payments. Even if you agree that you will send your partner the money to cover the costs, in the event of potential arrears, you will still be chased for payments.

If you are sending your partner money each month, you should also keep an eye on your credit report to ensure they are still actually paying the mortgage. If they default, then it will impact your own score due to the financial tether you have.

Get in Touch With a Dedicated Mortgage Broker

If your name is still linked with an existing mortgage, then the payments for that will be considered down the line if you buy a new home of your own. This means that lenders might not lend you as much as you would like.

Buying a home with someone is different than just renting with them. It’s always better to agree on what would happen to the house should things not plan out as expected.

For any First-Time Buyers in Leeds or those Moving Home in Leeds that are looking to purchase in Joint Names, you will absolutely benefit from speaking to a mortgage advisor. Even if you are looking to remove a name from a mortgage by looking into a Remortgage in Leeds in your sole name, a member of our mortgage advice team will be able to look into this with you. Please feel free to Get in Touch with our friendly Mortgage Team, we will be more than happy to answer all of your questions.

Gifted Deposits: How They Can Help You

Mortgage with a Gifted Deposit in Leeds

Gone are the days of 100% mortgages and the infamous Credit Crunch is now firmly in the past. Whilst the market has gotten stricter with rules (rightfully and understandably so), thus making it harder than it used to be to obtain a mortgage, it can still be possible in certain circumstances to buy a property without investing too much of your own money.

Buying a property under a Right-to-Buy Scheme in Leeds is one example, wherein after a specific tenancy length, you can become eligible for the Right-to-Buy your rental property from the local authority, be that a housing association or council. In a lot of cases, they may choose to use the equity from that property in place of a deposit.

In most cases though, we find that people get around the long and stressful process of saving up for their deposit, by being given a Gifted Deposit. This works exactly as you may imagine, with someone else being able to gift you either a portion of, or your entire deposit for a property.

Common Gifted Deposits FAQs;

  • Who can gift the deposit?
  • Can it be a loan rather than a gift?
  • How much can be gifted?

Who can gift the deposit?

Generally speaking, Gifted Deposits tend to come from what is known as the “Bank of Mum and Dad”, wherein as you might have guessed, parents (including adoptive parents, carers and legal guardians) are an acceptable source of a Gifted Deposit.

Depending on the lender and criteria in place, this can also be accepted if it is a gift from Grandparents, Aunties & Uncles, and sometimes even family friends. The gift must be evidenced through the demonstration of bank statements from the donor and their ID.

If the person gifting to you is over the age of 55, they may look to take out Equity Release in Leeds, as a means of gifting you a deposit.

Can it be a loan rather than a gift?

In the majority of circumstances it will need to be a gift, with the lender requiring that the donor sign a letter (which we can help prepare) to confirm the funds are non-refundable, and they will not put a “charge” on the property you are buying. There are exceptions out there, with at least one notable lender who will accept this.

That being said, you must be careful, as taking out a personal loan just before applying for a mortgage will most likely negatively affect your credit score, which could lead to a mortgage application being rejected. Also, the monthly payments for the loan will have to be taken into account by the mortgage lender when they are calculating how much they will lend you.

How much can be gifted for a deposit?

There is no maximum limit on the amount of gift you can receive although a handful of lenders will insist you put in at least 5% deposit from your own funds.

Are you looking for a Mortgage Advisor in Leeds?

As a knowledgeable and experienced Mortgage Broker in Leeds, we are able to look through 1000’s of Right-to-Buy Mortgage deals for you, tailored to your circumstances.

Throughout the whole process, we aim to offer a multitude of help and guidance, answering any questions you may have along the way. We even aid with other services when necessary, such as conveyancing.

Our brilliant team are incredibly proud of the service level that we provide day in and day out – This is reflected in our genuine customer reviews.

Leedsmoneyman Spring Budget 2021 Update

Rishi Sunak’s second Budget as Chancellor brought two pieces of welcome news for the property sector as the Government attempts to transform “Generation Rent” into “Generation Buy” to help stimulate the UK economy, namely the new 95% Mortgage Guarantee and an extension of the Stamp Duty Holiday.

95% Mortgage Guarantee

The name of this scheme is misleading as not everyone that applies is guaranteed to be offered a mortgage, it is still subject to affordability and credit score. The “guarantee” itself is that the Government will ensure Lenders don’t stand a loss if they grant a 95% mortgage to a customer who then subsequently falls into arrears and is repossessed leaving behind negative equity.

This scheme should in theory give Lenders more confidence to lend even though the applicant only has a smaller deposit to put down. Of course, Lenders never want to repossess someone’s home unless it is the last resort, but if that happens then the new scheme would cover any shortfall.

Lenders have been worried about the prospect of home values decreasing so this measure should alleviate that concern although of course, the chances of negative equity occurring will naturally reduce should property prices increase as a result of these announcements!

The scheme is available to both 1st Time Buyers and Home Movers, it’s available on any property (not just new build) and will run until December 2022. Some major High Street Banks have already signed up to the scheme and it’s likely more will follow later on. It’s still a big challenge for Lenders to cope with the demand they are getting for mortgages due to the difficulties training and supervising staff working from home but they will want to offer as many of these mortgages as they can.

Stamp Duty Holiday Extension

When the Stamp Duty Holiday was launched last year we all hoped life would be very much back to normal by the cut-off date of 31st March 2021 but things didn’t pan out that way as we know. Solicitors are struggling to keep up with the workload and if lots of chains had collapsed then it would have partly defeated the object of the exercise.

Therefore it was good to hear the scheme has been extended to 30th June for purchases up to £500,000 and 30th September for purchases up to £250,000.

The Government certainly sees the property sector as an area that can play a big part in our economic recovery and if you are looking to buy a home or remortgage this year please reach out and we will be happy to advise you.

Contact Us

The Effect Of January 2021 Lockdown On The Property & Mortgage Market

You can still carry on with the sale and purchase of homes/property after Tuesday 5th January and even move home if the need arises.

As per the announcement made by British Prime Minister Boris Johnson on 4th January 2021, the UK is now once again in a national lockdown. The implementation of this order took place the very next day, on the 5th of January with only certain sectors maintaining their activity throughout the next 6 weeks.

Functioning in a similar manner as to the November-period of lockdown, the property market will remain functioning and open for business. This means that you can still take up house viewings, move further with your property purchase and put your property up for sale.

However, it must be noted that some businesses can be hindered due to certain delays. In lieu of the restrictions and lockdown, the services of Solicitors and Surveyors may take additional time. Furthermore, It is expected that the Stamp Duty Cut could bring in a vast crowd of customers before time runs out for it.

Safety Measures for Home Movers in Leeds

It is seriously urged to everybody who is looking to move to a different home or in the process of doing so, to stay safe and follow the correct safety guidelines. Please ensure your safety by following the latest government guidance on your maximum safety while undertaking this.

Buyers can still avail 90% Mortgages

It is our pleasure to let you know that 90% mortgages are still there for you to utilise. It is evident to us that lenders of the UK property market are confident as ever. This is due to the awareness that the demand for property is still very much present within the market and people will only reach back out when they are sure of getting a deal with 5-10% deposit.

You can also obtain a 90% mortgage through schemes such as the Help to Buy Equity Loan scheme or the Help to Buy Shared Ownership scheme. For further details, you can speak with your mortgage advisor, who will walk you through the details of how these methods can help you obtain a mortgage with only a 5-10% deposit.

An Extension on Mortgage Payment Holidays

Mortgage Payment Holidays (the possibility of delaying finances that have a chance to leave you struggling during the pandemic) were slated to end on 31st October 2020. However and fortunately, an extension for the Mortgage Payment Holidays has been given until 31st March 2021.

If you haven’t accessed a Mortgage Payment Holiday, You can request a break of up to 6 months. However, in the case that you have taken a Mortgage Payment Holiday of less than 6 months, You can extend your existing holiday up until the 6th month.

Still Here, Still Open

Our trusted and friendly mortgage advice service is still operational and we’re available to help out in any way possible. We have a team of dedicated mortgage advisors on hand, who are free to answer your questions from 8am – 10pm, 7 days a week.

This past year has been a hard enough time for a lot of people. As such, we would like to take as much stress out of your mortgage process as we are able to.

All customers will still benefit from a free initial mortgage consultation, no matter their situation.

For a brief overview of the current status of the property and mortgage market, please watch our video from company director Malcolm Davidson, recorded the day after the Prime Ministers public speech.

Leedsmoneyman.com & Leedsmoneyman 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.
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The information contained within the website is subject to the UK regulatory regime and is therefore primarily targeted at customers in the UK.
Should you have cause to complain and you are not satisfied with our response to your complaint, you may be able to refer it
to the Financial Ombudsman Service, which can be contacted as follows

The Financial Ombudsman Service, Exchange Tower, London, E14 9SR
www.financial-ombudsman.org.uk

© 2022 Leedsmoneyman

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