You’ve managed to save up for a 5% deposit and are ready to start making offers on properties. However, you are still being let down and being asked for a larger deposit. Not being enough to save for a lerger deposit could be down to anything, e.g., sellers’ preference, other competition or your credit history.
From in-depth discussions about utilising the government schemes to simple points such as saving more money and waiting, here are some ways that can help you obtain a mortgage with a small deposit.
Taking advantage of government schemes can really help you through your mortgage journey. There are lots of schemes available that come under the ‘Own Your Home’ umbrella. These schemes were designed to allow opportunities for first time buyers and home movers to get themselves onto the property ladder.
The Shared Ownership scheme is very different. Shared Ownership lets you take a mortgage out on a percentage share of a property (usually between 25%-75%) and then pay the rest back via rent.
Since you are only taking out a mortgage on a smaller percentage of the property, your total deposit amount should be lower. Also, it’s worth knowing that you can increase the share of the property that you own further down the line if you want to. This can be a great stepping stone to get you onto the property ladder.
The scheme is a little complex in some cases. So, we’d recommend that you speak to a mortgage advisor in Leeds like us before diving headfirst into the scheme.
A Lifetime independent savings account should be introduced when you’re thinking of moving or buying your first home in Leeds.
This is because it’s a savings account where your money grows year on year interest-free. You can put as much money in it as you’d like each month, as long as it doesn’t exceed a total of more than £4,000 over the year. This is the maximum that you can save each year.
Each year, the government will top up what you’ve saved by 25%. So, if you save up to the maximum you will get an extra £1,000 for free. The savings from the account can be used for one of two things: buying your first home or saving for later in life.
If you set up a Lifetime ISA at the very start of saving for a deposit, you may only require a small deposit as the lifetime ISA can cover some of it for you!
If you’re currently living in a council house and planning to make an offer on the property, you may only be required to put down a small deposit, or in some cases not one at all.
This is because some lenders offer a right to buy discount through the government since you’ve already been living in the property.
This government-led scheme allows you to get a mortgage with just a 5% deposit. Therefore, if you go down this route, there shouldn’t be many reasons why you’ll be declined.
Of course, getting a mortgage is not guaranteed in any way shape or form. You’ll still be required to pass credit checks, affordability assessments etc.
There are other ways besides using government schemes to get a mortgage with a smaller deposit.
An agreement in principle (AIP) or also known as a decision in principle (DIP), can boost your chances of getting a mortgage with a smaller deposit.
An AIP shows that a lender is willing to lend to you given that you can provide sufficient documentation to prove that you’ll be able to afford a mortgage. If you’re making an offer on a property, you may be putting yourself in front of someone who’s also put in an offer who doesn’t have an AIP in place.
In this situation, it’s not really about the deposit. The indication to the seller will be that they’ll be able to continue through the process quicker by choosing you. Either way, they’re selling their home, choosing you will just speed up their process!
An obvious alternative would be to carry on saving up. Even pushing back your home buying journey for a further 6 months could boost up the total amount of your mortgage deposit.
Your small deposit could become much bigger if you knuckle down and save for just a little longer, in fact, it could get you over the edge that you need.
If there aren’t that many houses on the market that are appealing to you, there’s even more of a reason to wait for a little longer.
Remember that the 5%-mark changes depending on the property. If you want to move into a larger home, you may need to save up more anyway.
This is a very specialist situation and often, lenders will not allow it. As a mortgage broker in Leeds, we’ve seen it happen before, but it’s always on rare occasions.
Taking out a loan to cover your deposit can sometimes affect your ability to get accepted and this is because you are essentially borrowing 100% of the mortgage.
This results in having to account for multiple repayments. Lenders will question whether you’ll be able to afford it or not. They can’t risk lending to you if that loan is going to affect your ability to keep up to date with your mortgage payments.
Again, this is a specialist topic, and we would advise that you speak to a mortgage advisor in Leeds and get in touch with us first. Taking out any sort of loan during the months leading up to your mortgage application could potentially be a bad idea.
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.
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.
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.
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.
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.
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.
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.
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.
If you would like to go direct, that is great! Generally though, whether a customer is a First-Time Buyer in Leeds, Self-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.
Over the years as a Mortgage Broker in Leeds, we have found an increase in people paying a lot more attention to their credit rating. As a result of this, we have found that many people who get in touch with our team have already researched online to find a copy of their credit report.
There are many different credit reference agencies to choose from, but the two most popular companies you may know are Experian and Equifax.
Our team highly recommend that new customers who contact us look to use Check My File. By doing this, you’ll find a report that offers customers a collation of information from various sources (the aforementioned two included) in an easy understandable colour-coded report.
You sign up for a 30-day free trial with Check My File and after the 30 days, you will be charged £14.99 a month. This can be cancelled at any time before the end of those 30 days.
When dealing with customers, our Mortgage Advisors in Leeds are often asked if they will be doing a credit search on them. This is usually a customer who knows that too many searches can negatively impact their credit score.
Our mortgage advisors will always get permission for the customer to run a credit check, whereas the lender will run their own checks. There are two types of credit searches, one is hard searches and the other is soft searches. Below we will explain the difference between the two as well as how they can help.
A hard credit search is a type of credit check that provides an in-depth look at your credit report. All financial institutions that carry out one of these will need to seek your permission before undertaking this check.
One of the benefits of a ‘hard’ search would be how detailed it goes. Having this carried out and passing it can increase the chance of you being successful with a mortgage, however, this is not always guaranteed).
After passing this, the only thing that could go wrong with your mortgage process is if you cannot provide the required documentation to back up the information that you have presented to the lender, or it turns out you have provided incorrect information altogether.
Another advantage to having a hard credit search carried out will leave a ‘footprint’ on your credit file meaning that anyone looking at your report can see that this search has already been done on your file.
Having this mark on your file is not a bad thing at all, however, if your credit file shows that there have been multiple searches carried out in a short period of time. By having these displayed, it could give the impression to the mortgage lender that you are applying for lots of credit at the same time which wouldn’t work in your favour.
An important point you need to know about the ‘footprint’ is that it will not leave a note to confirm whether or not your application was successful. Therefore, having several searches highlighted on your report can result in the lenders’ systems assuming wrongly that you are being declined regularly. Think about it; why would you apply for credit with a second lender, unless you’d been declined by the first?
If you have the occasional hard footprint on your record it’s not going to be a massive issue which is why you don’t need to worry about it too much. It’s best to be careful not to have too many of these taken out.
The other type is a soft credit search. Opposite to a hard credit search, this would be a more straightforward approach by looking at your financial situation. These are normally done through price comparison websites, so you can find out what options may be on offer for you.
Another way it can be used is to verify your identity. Some mortgage lenders will carry out soft searches of their own. It can be common to find these days that even more lenders are changing to this type of credit search.
Even though the one drawback of a soft search is that you will get less information out of it in comparison to a hard search, if you managed to obtain an Agreement in Principle from a lender, this still can be a positive indicator that your application will be accepted.
The one factor that makes soft searches appealing to customers is that you are able to see soft searches that others have carried out on you (many are often surprised by how many have been carried out on them), but these searches will not be visible to other financial institutions like a bank or lender.
Because of this, you will be able to apply for an Agreement in Principle ahead of a mortgage in Leeds, without causing any damage to your credit score, whether you are successful or not.
In the case where you are a First Time Buyer in Leeds looking at making any offers on a property, our expert Mortgage Advisors in Leeds would highly recommend you get a mortgage Agreement in Principle before getting in touch with an estate agent.
It can be ideal to give yourself the best possible chance of securing your dream property at the lowest possible price. Therefore if you present yourselves as having your finances organised, it’s likely you will give yourself the upper hand in your mortgage situation.
Having an Agreement in Principle to hand can also help stop an estate agent from trying to cross-sell any of their own mortgage products to you.
After you’ve moved home, there’s always the situation of having to update your address on any account to match your new address, so that any posts, packages, and any other bits and pieces go to the right place. From your doctor’s surgery to any accounts that need an address, there’ll be plenty to work through.
We understand that missing an address can easily happen. When applying for credit, having less varied addresses on your accounts will look better on your credit score.
Because of the impact, it has on your credit score, this means it will also be beneficial for you when it comes to applying for a mortgage.
We tend to find first time buyers in Leeds, and home movers in Leeds would have a much better understanding of how credit scores work and the importance of updating their address sooner rather than later.
Whereas with other applicants have moved out of their family home and are now renting their own place. They don’t see the harm in leaving their bank statements, electoral roll information, and credit cards at their previous address. But having everything under the same address will give you an advantage during your mortgage process.
Every time you’ve moved house, there will be a record of it somewhere on your credit report. Any bills related to your name, like car insurance, any orders from places like eBay, Amazon, or even online food shops, will show up with a record of the selected address you choose.
If it looks like you are living in two places at once or have failed to disclose information to the mortgage lender, it may go against you during your mortgage process. After all, your mortgage lender needs to know you are reliable for a mortgage.
When looking to buy a new home, and applying for a mortgage, the best thing you can do is make sure all addresses under any account are up to date and accurate.
This includes checking all those shopping accounts, electoral roll, credit cards, and anything you can think of that has your address, are all up to date, and have the current address for you and your current home.
When it comes to updating your address to your new location on the electoral roll, make sure that you definitely get the right dates for when you moved in and out, as getting this wrong can also give off the impression that you are living in two places at once which may mess up your chance to vote.
Keeping all addresses up to date is a much more open and honest way of applying for a mortgage with a lender. Not only will it work in your favour, but it will make your process go a little bit easier.
As well as keeping your address up to date, there are other tips that could also be beneficial to first time buyers in Leeds, these tip can include.
Managing your bank accounts, avoid any unnecessary charges and limit any gambling transactions, (if that is something you do regularly). These can have a harmful effect on your mortgage process if you do the following too often.
Remember that your bank account will be a reflection of your ability to maintain payments, generate income and handle your finances appropriately. This is a large factor in determining whether or not you are able to get a mortgage.
A gifted deposit is a great way to help first time buyers in Leeds get onto the property ladder. A gifted deposit is where a close family member or friend, gifts a portion or the full amount of a deposit to a homebuyer. As the name suggests, a gifted deposit is purely to be a gift and not a loan to be repaid.
We highly recommend that customers, whether new or existing, look to obtain an up to date credit report. Check My File can help pull together information from various sources, to get a more complete view of your financial state.
Taking out a mortgage will be one of the most significant financial commitments that you will ever make. You will want to get your dream property for the best deal you can get.
The good news is that you have the chance to plan ahead of other buyers to help improve your chances of getting your mortgage application accepted. – One of these examples will be having an Agreement in Principle before you start viewing properties.
You may come across a point where it is unlikely to plan for a mortgage, for example, if you and your partner decide to split up. It’s unfortunate when this happens. However, if you are in this situation, you may need to move from a joint to a sole name mortgage.
We recommend that all new customers start planning their mortgage for up to six months before you begin Moving Home in Leeds.
Preparing your application for all possible situations will prove beneficial further down the line. If you encounter a problem, in theory, you should be able to figure out what to do to resolve it.
Utilising over 20 years of experience within the sector have allowed us to come across various mortgage problems. When it comes to the end of the mortgage process, some hurdles could crop up, and our Mortgage Advisors in Leeds may be able to rectify them if you prepare right.
Here are some general hurdles our customers frequently come across.
With up to six months of preparation and planning, you may be able to avoid some of these problems.
Saving up for a deposit can be tricky, especially if you’re stuck renting. It can take some First Time Buyer in Leeds several years worth of savings to save for a deposit.
Location varied; some might find it challenging to save up for a ‘5% deposit’ as you don’t know the exact amount you need until you find a property you like. Each 5% total will vary from property to property.
Customers who struggle to meet that initial deposit total will often get help from their parents through a gifted deposit. A gifted deposit is an extra cash boost given to a homebuyer to help buy a property and can equate to some, or all, of their deposit.
Gifted deposits were given with the understanding that the money doesn’t need repaying.
If eligible, you could also apply for one of the Help to Buy schemes if you need a deposit boost. These Government schemes got explicitly made for applicants that needed help to buy a newly built home. If you’re a First Time Buyer in Leeds looking for help getting onto the property ladder, one of these schemes could be suitable for you.
Your credit score is fundamental when it comes to applying for a mortgage. Having a poor credit score can lower your chances of getting accepted for a mortgage. Of course, it depends on what is the cause for you having a low credit score.
If it is because of a CCJ or bankruptcy, your chances of being accepted can be lowered further, depending on how long ago these issues occurred.
If you want to look at your credit score, we recommend using Check my File. Check my File allows you to get a copy of your credit report, from there on you can establish whether you have any credit issues that might be flagged up or prevent you from borrowing from a lender. Once you have this, feel free to send it to us, and we will take a look at it free of charge.
During the approach to your mortgage application, you need to think about how you conduct your finances. Lenders will be carefully analysing your bank statements and will see everything that’s going in and out of there. An example to look out for would be gambling transactions.
Lenders aren’t keen if they see frequent and erratic gambling transactions on your bank statements. They will see gambling with large sums of money unreliable and possibly decline your application.
If you’ve been lucky enough to receive a gifted deposit, we advise keeping that sum of money in the gifter’s account.
Because your lender will see a large bank transfer into your account and ask questions, sometimes it’s better to leave the gifted deposit inside your family member’s or friend’s account.
Self employed applicants often have a hard time when it comes to getting a mortgage. Usually, this is because they are required to evidence more than a usual mortgage applicant.
You will have to submit at least one year of accounts’ and three months of bank statements to prove your income and affordability.
Depending on the lender, you may get asked to provide even more evidence if they are unsure of your affordability.
In situations you can’t prepare for, know that a Mortgage Broker in Leeds like us is here to help. Each person could counter all different kinds of mortgage hurdles and it’s our job to guide you through the entire pricess.
People who have encountered all different types of specialists and complex situations often come to us for expert Mortgage Advice in Leeds. We offer a helping hand and back you up during the entire process you don’t have to go through this process alone!
A lender will need to see your bank statements to learn more about you and your spending habits. How you have acted lately, and the presentation of your bank statements can affect how much a lender will let you borrow, if anything at all.
The lender needs to know you’re responsible with your money and can be trusted to handle finances appropriately. After all, a mortgage is likely the most significant financial commitment you will ever make in your life.
Your bank statements are easily obtained either in the post from your bank, over the counter from your local bank, or, as often seen these days, as a printable version from your bank’s online platform.
Again, they need to know you’re responsible for your finances. One of the things they’ll be looking at is if there are any overdrafts. Using this often is not necessarily a bad thing, but if you exceed your limit regularly, this will put your level of trust into question.
More factors to be careful with are potential returned Direct Debits, showing a lender you are not consistently reliable and not disclosing loans at the application stage. It won’t look good if the lender finds outgoings on your bank statements that you failed to mention. Once again, this is a process of trust.
Other things include missed payments for personal loans and items such as credit cards. If you can prove you handle your money well and meet monthly payment deadlines, a lender will be more likely to lend you an amount closer to what you would like to borrow.
Customers find themselves stuck when they have a history of gambling. The occasional bit of fun is harmless, but if you are frequently betting large amounts of money, whether you’re making it back or not, a lender will not look at your situation favourably at all.
To learn more, please see our article on “Do Gambling Transactions Look Bad on My Bank Statements?”
From our experience working with many First-Time Buyers in Leeds & Home Movers in Leeds, we have found that most mortgage lenders will want at least three months of bank statements from an applicant.
With that in mind, it’s time for you to forget the past and think about the future. You have at least three months to work on your finances. The first thing we’d suggest is that if you are a frequenter of the local bookmakers or online gambling scene, you take a break for some time. Not only does this benefit your financial state, but it can benefit your mental health too.
The following steps we would recommend taking are to trying to save money. For example, cooking instead of eating out, treating yourself to unnecessary purchases and cancelling unneeded subscriptions are great ways of freeing up additional cash to ensure you can pay bills on time.
Again, this boils down to simply being sensible and planning with plenty of time ahead of what you’re looking to do. The further away you find yourself from bouts of debt and financial uncertainty, the better your chances will be with a lender.
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.
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.
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.
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.
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.
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.
In 2013, to help boost the market after the credit Crunch left many home buyers and sellers in a difficult situation, the Government introduced Help to Buy. Help to Buy is a series of schemes to help First Time Buyers in Leeds struggling to save enough for a deposit to put their foot onto the property ladder.
Shared ownership allows applicants to buy a share of a property. How the scheme works is you own a percentage of a property that typically has to be between 25%-75%, and then you pay the rent on the remaining percentage.
The remaining percentage of the property is likely to be owned by the housing association. However, you can eventually repurchase this percentage further down the line if you wanted to. If you like the property and have long-term plans to stay there, you could buy the remaining share. People usually do this once they have the money and have settled into the property.
With the Help to Buy Shared Ownership scheme, you will still likely have to pay 100% of the ground rent and the property’s service charges, irrespective of what percentage you own.
This scheme was introduced off the back of the Help to Buy Equity Loan scheme in 2014. It aimed to help Armed Forces members get onto the property ladder as a thank you for serving their country.
If you are struggling to get yourself on the property ladder and are a member of the Armed Forces, this scheme could be perfect for you. The Government has decided to make it an enduring policy.
The Lifetime ISA is a great way to get yourself on the property ladder. You can use this scheme to help purchase your first home. If you are a First Time Buyer in Leeds, this scheme might appeal to you.
The Lifetime ISA is a savings account where your money grows tax-free. As well as your tax-free savings, the Government will also top up whatever you have saved by an extra 25%. The maximum amount that you can save each year is £4,000, so if you manage to save this much, overall, with the government’s 25% top-up, you will have £5,000 each year. If you save a little less, the Government will still top up your savings by 25%.
Here are the criteria for the Lifetime ISA:
We hope this information was useful, if you have a question or want Help to Buy Mortgage Advice in Leeds, don’t hesitate to get in touch with our friendly advisors who are here from early until late, 7 days a week! We also offer a free mortgage consultation to every customer no matter their mortgage situation.
Originally introduced back in 2014, this £200 million scheme was intended to boost anyone from the forces who needed help buying a home. The project was meant to end in December 2019.
As a thank you to everyone’s commitment to their Queen and country, the Government has now made this an enduring policy.
People who have served in the military have access to borrow a deposit of up to half their annual salary (a maximum of £25,000), interest-free. This can be used to either purchase their first home purchase or to move into a new home.
The most satisfying part is that you don’t need any current savings to get onto the property ladder. The money gets raised from the loan you’ll receive via the scheme can be used to put towards your deposit or other costs, such as:
In fantastic news for forces personnel, a large majority of lenders will accept the loan towards the deposit for a new home. More relaxed than some other schemes, the Forces Help to Buy loan can be paid back over 10 years, so you don’t have to feel rushed.
Whether you thought you had a chance or not, you are eligible to purchase your home using this scheme, only if you have served your country and can meet the right criteria (length served, service term left and medical categories).
Click here to read through further details from the government.
Our experienced mortgage advice team in Leeds has your back from day one. Right from the beginning of your process when you call up, right through until competition and beyond, your dedicated advisor will make sure you are taken care of, ensuring that you end up with the most relevant result for your individual circumstances.
As a company that prides itself on a fast and friendly customer experience that is stress-free, contact us today and see how we might be able to help you achieve your home-owning dreams.
Please note, the Forces Help to Buy is not the same as the standard UK Help to Buy scheme.
A Mortgage Agreement in Principle is essentially a document to prove you have a mortgage in place. It is something we obtain for all our clients, and almost all lenders offer them. It demonstrates that you are creditworthy because of the Agreement certificate to be issued, you must pass the Lender’s credit score.
A Mortgage Agreement in Principle is not a guarantee that you will definitely get a mortgage as your full application will require further background checks (such as evidence and income) and a satisfactory valuation of the property itself. However, we think it’s a good idea to get one done at the earliest opportunity for the following reasons:
1. Negotiating Power
2. Avoid Disappointment
3. Knowing your Limits
When you are ready to offer a new home, most Estate Agents will undertake due diligence and ask you to produce evidence that you have funds available to complete the purchase. This will take the form of bank statements and an Agreement in Principle certificate that we can provide for you.
Once you have provided them with enough documentation the Estate Agent will naturally stop marketing the property and put a “Sold” or “Sale Agreed” boar outside the property to let other people know it’s off the market.
Suppose you already have a mortgage agreed upon before you make an offer. In that case, you are making yourself appear as an attractive proposition as this proves you are not making an offer on a “whim”, you’ve thought about how you’re going to fund the purchase and have done something about it. This might persuade a seller to accept an offer you put forward on their property underneath the asking price.
When it comes to buying a house some clients have always “put the cart before the horse” to say they go full steam ahead and make an offer on a property without first checking that they are actually in a secure financial position to proceed. This can lead to terrible disappointment if the mortgage application fails because, by that time, they have got their heart set on their new family home.
Furthermore, your mortgage getting refused isn’t always down to the offer you put in. It can sometimes be something else. For example, there may be a niggling issue on your credit report, perhaps a disputed mobile phone bill that can easily get rectified. Maybe you thought you were on the voter’s roll and you’re not – once again that can be sorted out given a few weeks.
Maybe you can’t get a mortgage at all, and if that’s the case, it’s better that you know now rather than mess people about, though we may be able to help if you contact us and we’ll be able to tell you what you need to do to improve your credit-worthiness for the future.
By now you know you’ve got a good credit rating because you’ve never got turned down for credit, you’ve registered on the voter’s roll and you’ve always made your credit card payments on time.
You could approach ten different Lenders these days and get ten different maximum mortgage amounts; they all calculate affordability in their own unique ways. If you’re self-employed in Leeds: some Lender can take your net profit, others your salary and dividends. Some use your latest year, others an average over three years.
Knowing your borrowing limits is essential as then you know for sure what your price range is.
Our team of Specialist Mortgage Advisors in Leeds may be able to advise you of the maximum mortgage available to you. Even more importantly together, we’ll work out how much you can afford to pay back each month.