For a First Time Buyer in Leeds, many applicants have gotten in touch with our Mortgage Advisors in Leeds, describing to us that to them, Getting a mortgage is like being stuck in a maze. All lenders have their unique lending criteria. Many people have got left feeling like an unsolved Rubix cube when it comes to trying to obtain a mortgage directly with a lender. That is where our fantastic team of Mortgage Advisors in Leeds comes into play.
Some lenders’ credit scores are more accessible to pass than others. They are all targeting specific parts of the market. Often the Lenders with the lowest rates have the tightest lending criteria. As such, most customers do not match the requirements of every lenders out there.
When Lenders offer very competitive deals, their margins are very tight. To remain profitable, it is crucial to these Lenders that their customers do not fall into arrears. As such, it can be difficult to qualify with them.
These High Street Lenders, with the very cheapest deals, have other ways of trying to maximize their earnings from borrowers. Once your mortgage got agreed, they will undoubtedly try and “cross-sell” you other products that they offer that make them more commission. These products include Bank Accounts, unsecured loans, credit cards, and Insurance.
Sometimes the mortgages with the lowest rates of interest come with high set up fees. Sometimes it’s better to ignore these products. As your friendly Mortgage Broker in Leeds, we search thousands of deals to recommend the best product that represents the best value for money for you taking everything into account.
Lenders can also look to take advantage of their customers when their initial deals are coming to an end. Some lenders still let borrowers drift onto Standard Variable Rate hoping clients stick with them. More often these days, the Lender will offer a “follow-on” deal, also known as a “product transfer.” While these deals are easy to take up, they are rarely the most competitive and sometimes not as reasonable as the deals made available to new customers.
Also, on the subject of Standard Variable rate mortgages, of course, not all customers are eligible to Remortgage elsewhere. Perhaps their circumstances have changed, such as a relationship breakdown. Maybe there is less income coming into the household now than at the point of application. If an applicant has had a default or CCJ since they took the mortgage out or the value their home has dropped since they bought it.
Returning the Lenders’ criteria, depending on how the economy is performing as a whole, can affect how easy or hard it is to get a mortgage. When the economy has been suffering lenders can tighten the purse-strings and vice versa when things are going well. Some would say sometimes it’s too hard to qualify for a mortgage, and in other years it can arguably be straight forward.
Although I am referring to the “Sub-Prime” and “Self Cert” mortgages that were readily available to many people in the mid-2000’s, at that time, new lenders were regularly launching with ever more relaxed lending criteria. In the USA, the phrase ‘Ninja Mortgages’ was bandied, which meant no Income, no Job, or Assets. This type of reckless lending is behind us now, thankfully.
Lenders took a completely different view and tightened criteria. Often a 25% deposit was required, and for many people, it became seemingly impossible to get on the property ladder. Interest rates were high as well, making it tempting for customers to continue renting.
Malcolm has gone through all those trials and tribulations that gave him invaluable experience and deep insight into what the lenders are looking for in mortgage applicants. Within this, I am referring to Credit Scoring, which most High Street lenders do now to save them time and money and also produce consistent decisions.
Lenders are very cagey about disclosing what influences their “Computer Says No” decisions. Still, having seen thousands of customers literally over the years. We are able to share with you some simple steps you can take to improve your chances of your mortgage application being successful.
Some of these steps are straightforward, things you can do in the course of one evening that will make a difference, such as ensuring the formatting of your address is consistent across your accounts. If you don’t qualify for a mortgage yet, you can put in the foundations so that when the time is right, you are in a much stronger position to go ahead.