The majority of people out there maybe only think about their mortgage goals or existing mortgages every few years. Here at Lincolnmoneyman, we think about mortgages every day.
There is never a minute of our working hours where we aren’t engrossed in a case, working hard to try and help someone find a favourable outcome.
Because of the time and effort we put into being so efficient and valuable to the customer, we are well versed in lender criteria, understanding which of those on our panel would be most likely process your mortgage application.
We also like to ensure you are on the best rate available to you, eliminating any stress and long delays as best as we can.
Here are the 3 main advantages of seeking mortgage advice in Lincoln:
Long before you could just Google the answers, comparing mortgages was a long and tedious process. Customers would use up their Saturday mornings going from bank to bank, to building society and so on, looking around to try and find the best deal on offer.
Although most of this can be cut out now, it’s still not completely straightforward, especially for those who are maybe first time buyers in Lincoln. With all the fees and charges and exit penalties from existing deals, it can be very confusing.
We use daily-updated mortgage sourcing software so that your dedicated mortgage advisor can recommend the most suitable mortgage for you, the customer. It’s our goal as a company, as a team, to save both your time and your money.
You may be able to source a good deal, but it’s an entirely different ball game when it comes to actually being accepted for that deal. It’s not as simple as finding and asking for it, as you’ll have to match the lenders criteria for it.
There are lots of different reasons why people get declined for a mortgage nowadays, including low credit score, length of time they have been employed or self-employed (self-employed mortgages in Lincoln are always becoming more popular, so it’s important to do research ahead of time if you are your own boss), and failing the affordability calculator.
There are even more than that, but what is important to take away from this, is it is not something to be taken lightly. If you jump into the unknown, unprepared and ultimately unmatched, this could lead to a damaged credit rating. Every time you apply for a deal, the mortgage lender will carry out a credit search.
Too many applications to deals you don’t qualify for can come across to other lenders like you’re constantly being declined for something, which in turn could lead to the right lender with the right deal declining you as well. Your best bet is to speak with us first, so we can try and match you up with the right lender the first time.
It has been said that other than dealing with the loss of a close family member or going through a divorce, that moving house is the most stressful experience you will face in your lifetime. This is especially the case if you’re selling a property and trying to complete your new purchase at the same time.
It’s our job to reduce your stress levels and work hard to make sure your mortgage application runs as smoothly as it possibly can. The best advice we can give, is to suggest getting in touch and speaking with a mortgage advisor in Lincoln, prior to finding a new home. In doing so, you will know roughly how much you are able to borrow and what your monthly mortgage repayments will be.
There’s a lot to work through with the legal aspects of your property purchase, packing and dealing with estate agents. We regularly hear from customers that they were glad to have a Mortgage Advisor in Lincoln by their side throughout the mortgage process. Get in touch and we’ll see how we are able to help you!
To help first-time buyers get the most out of their mortgage process, we have put together a list of the 10 steps involved for first-time buyers in Lincoln. It is our hope that with this, you can be as prepared as possible ahead of your own mortgage journey.
There are 10 main steps you’ll go through in the process of buying a home and obtaining a mortgage. These are as follows;
So let’s say you’ve decided to take that next big step in your life and purchase your very own home, taking out a mortgage as a first-time buyer in Lincoln. It probably goes without saying that this will probably be the biggest financial choice you ever make. Once you realise this, the concept can be a little daunting, especially when you have no experience in any of this.
It’s at this point where a dedicated mortgage broker in Lincoln may be able to step in and provide assistance to you. We always strive to take the stress away from our customers, working hard to make sure they all are all happy, have a favourable mortgage deal and their very first home.
Once you Get in Touch with a dedicated mortgage broker in Lincoln, we’ll book you in for a free initial mortgage consultation with an experienced and loyal mortgage advisor. From here, we’ll take some details from you and take a look at your plan, before we eventually kick off your mortgage process.
During your free mortgage consultation, a trusted mortgage advisor in Lincoln will be able to run through a Mortgage Affordability Assessment. The process for this is pretty quick and is very important, as this is where your dedicated mortgage advisor will run through your monthly income with you, looking at your regular expenditures.
This basically just means looking at what you spend your money on, and is done so they can determine whether or not you are financially capable of affording the monthly repayments of the mortgage amount you’re looking to borrow.
The reason we look to get this done prior to putting you forward with a lender, is to give us a level of confidence in you regarding your ability to afford your repayments. In doing this, we can try to avoid the risk of arrears and any future repossessions that may crop up, as this is something the lender will definitely want to avoid if it can be controlled.
A Mortgage Affordability Assessment will also usually be taken out by the lender themselves, so the initial checks we undertake will help save the lenders time, our own time, but most importantly of all, your time. The last thing any of us need is an application that may be declined in the future due to failing on affordability.
The following step in your mortgage consultation will be to get a hold of, on your behalf, a document called an Agreement in Principle. If you have done some of your own research on mortgages before receiving first-time buyer mortgage advice in Lincoln, you may come across this under a handful of different names.
Standard names used for this can include ‘Decision in Principle’, ‘Mortgage in Principle’, as well as ‘DIP’ & ‘AIP’. These are all exactly the same thing; the only difference is the name people may choose to use.
The reason you will need to have obtained an Agreement in Principle is to demonstrate that you have passed a lenders initial credit scoring system, either by way of a hard credit search (this leaves a credit footprint) or a soft credit search (this generally does not leave a credit footprint).
Even though this does help a great deal, there is still no guarantee you will be accepted for a mortgage. Still, it is a necessary and incredibly beneficial step to take, as it will also show the seller of a property that you are making a serious enquiry, possibly creating room for any potential negotiations with them when it comes to your offers.
The standard length of an AIP is usually anywhere between 30-90 days, and once it has expired, a mortgage advisor can easily renew this for you. Our brilliant team can usually get one of these turned around for you within 24 hours of your primary appointment with a dedicated mortgage advisor in Lincoln.
After you have gotten an Agreement in Principle, you will need to start looking for a conveyancer to help you with the legal dealings of homebuying. The term conveyancing is the name for the transfer of legal ownership of property between the different parties, whether you’re either the buyer or the seller.
Your conveyancing solicitor will handle the contracts for you, provide you with any necessary legal advice, conduct local council/authority searches on your behalf, help make arrangements with Land Registry and lastly transfer the funds you have acquired, so that you can pay for the property. As is likely evident from these tasks, this is a vital role in your process, so you must choose the right one carefully.
Something else you should know here, is that licensed conveyancers are property specialists and can’t deal with more complex legal issues, whereas a more general solicitor will be able to offer a full range of services, which can make them sometimes seem more costly. Whilst we do not offer these services directly, we do have an internal list of trusted companies that we will happily refer you to, if you need us to.
Once you have spoken to a fast & friendly mortgage broker in Lincoln, have passed the Mortgage Affordability Assessment, gotten your Agreement in Principle and carefully found yourself a trusted conveyancing solicitor to help process the legal elements of your home buying experience. This means you’re halfway to the finish line! Your next step is to make an offer for your desired home.
As touched upon earlier on, with an Agreement in Principle now in your possession, you will have better success in negotiating with the seller regarding price. Be sure not to make an offer that could insult the seller, but also don’t be afraid to try and negotiate for a lower price.
Knowing you have an AIP, you are more likely to have an offer accepted, as you are prepared for the process, rather than someone who is willing to pay the asking price but hasn’t even gotten themselves in a position to start their mortgage journey.
Worst case scenario, the seller will say no, but it’s at that point you can either come to an agreement on a better price or walk away and find yourself another property with a price that suits you a lot better. Once you’ve had an offer accepted, it’s time to get back in touch with your mortgage advisor and move onto the final steps of your mortgage journey.
A step now that is crucial to the process; submitting the required documents to go ahead with a mortgage. As can probably be expected when it comes to such large financial commitments, a lender will not just give money to anyone who gets in touch, wanting a mortgage. This has happened in the past and if you cast your minds back to 2007-08, it was disastrous.
The mortgage lender will require lots of different documentation to prove that you are who you say you are, your current income amount, where you live at the moment and how well you conduct your finances on a monthly basis. If you’re applying for a joint mortgage, they will need this same documentation from all involved.
The types of documents you will need to submit to the lender, include; proof of identification, proof of address, the last 3 months’ of your pay slips and latest P60 (employed), proof of any income such as state benefits or maintenance, proof of deposit, the last 3 years’ proof of earnings and Tax Year Overviews (self-employed in Lincoln) and the last 90 days of your personal bank statements.
Now that you’ve had your mortgage agreed in principle, and had an offer accepted from the seller, we can go ahead and submit your full mortgage application. At a point where you’re now prepared and everything has been checked by your mortgage advisor in Lincoln & their team of mortgage administrators, we are ready to submit your application to the lender, hopefully obtaining you a mortgage.
Your advisor will send off all the collected evidence for this, and then it is just a matter of waiting for them to respond with either an accepted application or a declined one. Whilst there isn’t a specific time frame, our team will be able to chase the lender and find out an answer for you, until it has been made clear.
In-between your mortgage application and being offered a mortgage, the lender will need you to have a property valuation survey taken out. This will usually be carried out by accredited companies nominated by the lender (someone that the lender knows they could trust).
The reason they do this is to gain an understanding of the true value of the property, against what you’re paying for it. If you’re paying above its market value, the lender may be less willing to lend to you. This is because if any arrears were to occur at a later date, they would lose out on their money. The act of refusing based on its actual value is usually referred to as a ‘down valuation’.
There are many different types of survey available, with differing prices on each of these. Some will just want to check how much the property is worth, whereas some may let you know of any structural concerns, as well as possible repairs that may be worth looking out for in the future. Your mortgage advisor in Lincoln will be able to give you a good indication as to the right property survey to have done.
We’re almost at the end now. Your lender has analysed your case and performed an assessment of all the documented evidence. Once this has been done, you will receive a mortgage offer.
Our caring and committed mortgage advisors and administrators in Lincoln, that you’ve surely gotten to know fairly well throughout your mortgage process, will check over the offer on your behalf to ensure everything is correct and as you wanted it. After your mortgage offer has been received, it’s down to your conveyancing solicitor to take your purchase all the way through to completion.
A big congratulations to you, you’ve now officially gone from first-time buyer in Lincoln to a first-time homeowner in Lincoln, with their own name attached to a property. At this point we hope your worries are now firmly behind you, and that you’re both happy and ready to begin your new life in your very own home.
All that is left is for you to get your keys and start moving in! We hope you enjoyed speaking to our team along the way and were given a fast & friendly mortgage advice service. If you have chosen a fixed rate mortgage, we will Get in Touch towards the end of your journey to help out with your remortgage!
Deciding to buy your first property is a challenging task. Therefore, you must take your time, look around for various options thoroughly and make an informed decision.
As you might anticipate, we believe there are some excellent reasons to use a mortgage broker in Hull. Whether the brokerage service is online, you can still pay a visit directly to the lender. Even in technological advancement, we find that most people still refer to a mortgage broker. Hence, we will take you through the pros and cons of both methods.
Firstly, a well-versed mortgage broker will take the time to have an initial conversation with the applicant to help him decipher if you are mortgage ready to make an application. When contacting us and gathering the necessary details, one of our mortgage advisors in Lincoln will make sure to shop around and get the best deals possible.
One of the most notable advantages of going with a mortgage broker is valuable expertise in the home buying or refinancing process. Mortgage brokers have ample industry experience to lean on when offering mortgage solutions to their customers.
Similarly, our mortgage broker in Hull also has access to try and find wholesale rates on home loans. These rates can be lower than the retail interest rates, helping borrowers save a substantial amount of money over the life of a home loan.
Most importantly, a Mortgage broker can be your point of contact from the time you first call them right up to when you finally get the keys of your house in your hands, and we will guide you through the entire process.
On the contrary, going to a bank helps save you a broker fee, saving yourself a reasonable amount. In earlier years, another significant advantage of a bank was that the branch manager knows an individual’s finances in and out. However, that all went by the wayside when credit scoring came in and is no longer the factor.
Likewise, some Lenders offer exclusive ‘direct-only’ deals that a broker would not have any access. Lenders do this to attract a wide range of applicants to make a good spread of business from consumers and brokers alike, turning exclusive products on and off when deeming necessary. On the other side, some products may only be available via the broker and not direct with the lender.
From 2014 onwards, lenders got restricted to sell mortgages on a non-advised basis to just anyone. Up until that point, many applicants felt like the non-advisors had been trying to force actual advice on them. They weren’t able to benefit from some consumer protection that goes with mortgage sales conducted by professionally trained mortgage advisors.
Lenders were coming to terms with and hence the issues present in these services led to a significant shift towards more applications getting made via mortgage brokers who are quick enough to offer you same day mortgage service.
You also need to check carefully if a lender is willing to lend you a considerable amount of money. It does not matter how good a lender’s deal might seem, but he should lend a significant amount. For this reason, people opt to go to an apt and professional mortgage broker in Lincoln.
Nowadays, mortgage applications are no more straightforward. Many factors make a case more complicated. A few of the examples are as follows:
– Poor credit history
– Too much debt
– Payday loans
– Self-Employed Income
– Mixed source of deposit (savings/gift)
– Let to Buy (keeping your current house and buying another)
– Contract workers/zero-hours contracts
In the past years, lenders could stand out from the competition by offering a better deal to the applicants. In the current era, this is different because the lending criteria vary from one lender to another. Some lenders lend more to Self Employed applicants or take a more empathetic view of their credit report’s previous discrepancies.
When you explain your case to an experienced mortgage broker in Hull, there is a possible chance that they have encountered the same thing earlier in the past, allowing them to personalize their service and help you through the process. With extensive experience in the field, your mortgage advisor will hopefully be able to recommend the most suitable lender for you at the lowest rate possible.
More than that, it is not just about getting the Mortgage. Even if the application itself is self-explanatory, we offer extensive experience and knowledge to our clients. For example, we will discuss how much we will deliver on the property they are buying. Our team of mortgage advisors in Hull can recommend other professional services such as Solicitors and explain the different types of protection and survey available.
Another significant advantage of using a mortgage broker is that the brokers are far more responsive than some lenders. Delivering personalized service is the differentiating factor between the broker and a lender.
Besides, another significant reason for hiring a mortgage broker is that it helps you save time. Most customers prefer a broker because they are too busy nowadays. they might need a mortgage but have no time to get it done so that our advisor will take the weight off for you.
You only need one application with a mortgage broker rather than individually filling out forms for every lender. Your mortgage broker can also provide a comparison of any loans recommended; guiding you to the information that accurately portrays cost differences, with current rates, points, and closing costs for each loan reflected.
At the start of the Coronavirus pandemic, the Government promised that all borrowers would be allowed a three-month mortgage payment holiday on the condition that they needed it. Most lenders followed the Government’s guidelines and did their best to help out their borrowers during these hard few months.
We felt that it is best, to sum up, what mortgage payment holidays are, what lenders are doing, and who can deliver you with help and advice through these next few months.
Mortgage payment holidays are agreements you make with your bank, building society or mortgage lender, allowing you to take a break from your monthly mortgage payments for a set period. In the case of the current COVID-19 crisis, homeowners are being granted 3-months relief.
The 3 months will be added on at the end of your term or your payments will be recalculated at a slightly higher level, meaning you will still have to pay those 3 months back eventually.
Your interest, however, carries on as normal, meaning you’ll technically be paying an additional 3 months of interest on top of what you’ve paid already.
Most lenders would likely prefer to not extend your mortgage term, as you may end up going beyond their standard retirement age. There’ll be more information on this over time.
Depending on the mortgage deal you have in place, you may be able to pay off a lump sum later on in the year to bring your mortgage in line with where it would’ve been had you not taken a holiday.
Mortgage Payments Holidays are available for those with residential mortgages and Buy to Let mortgages, meaning landlords will also have help if their payments are affected.
The full proposal is in detail below:
To discuss your options for Mortgage Payment Holidays, we would recommend speaking to a Mortgage Advisor in Lincoln to start with and not jumping straight into taking a holiday.
We’ll be able to take a look for you first and see if this option is something worth your time. Lenders will no doubt be facing an influx of calls, needing to be free to speak with the most urgent matters over everyone else.
We’ll look through your personal situation and see if there are any other options for you first before you decided to take a Mortgage Payment Holiday.
For a customer, up to date with payments, not in arrears and impacted by COVID-19:
Generally, these can show up on your credit score as a negative mark, but most lenders have said if your case is linked to the virus, they’ll make sure it doesn’t affect your credit score at all.
It’s important that you speak directly with your lender to ask them this, recording their response. Also take the date and time, as well as the name of who you spoke to, to avoid any confusion later on. Different lenders will handle these things differently than one another.
Controversial for some, but there is now evidence that lenders are asking borrowers to try and not make changes to their mortgage whilst within the holiday period. This means, for the time being, you can’t take out a remortgage or product transfer.
In simpler terms, borrowers reaching the end of their current product may be forced to move to the higher lenders variable rate. This means many borrowers who act too quickly could find themselves on a Mortgage Payment Holiday that gains interest on a more expensive variable rate.
This is another reason why we highly recommend speaking to a Mortgage Advisor in Lincoln first, to determine the right path for you to take. If possible, try arranging a transfer prior to asking for a holiday, as that seems like a more sensible option.
Some lenders are offering a temporary switch to interest-only, in order to reduce monthly payments by a large amount, while not adding on any further amount to the loan, by still servicing the interest each month.
You may not need to convert the entire mortgage to an interest-only mortgage and it may be that putting only a portion of this mortgage on that basis could give you room to breathe.
Those who have savings may prefer remortgaging onto an offset basis. This would reduce their monthly payments whilst keeping their savings safe and intact.
For example, someone with a £500,000 loan and £100,000 in savings would only pay interest on £400,000 reducing their payments accordingly.
For others, remortgaging onto another lender, calculating the cost of any early repayment charges, maybe all you need to ease the pressure you currently face. You could also simply extend your current term, thus spreading your payments across a longer time frame.
To discuss any of these options, or to just have a helpful chat about your current situation please contact us and we’ll see how we can be of assistance.
A gifted deposit can be either the full amount or a portion of the deposit that is gifted to you, with an agreement that you don’t need to repay the money.
Gifted Deposits come in handy when you have enough money for your monthly repayments but can’t afford the initial deposit. Having more gifted deposit available may also open you up to better rates from a lender.
It can also help if you’re on a lower salary and can afford the monthly mortgage repayments but are unable to save your initial deposit.
Predominantly it is your parents who can gift you the deposit. This can be both birth and adopted parents. You may see this online as the “Bank of Mum & Dad”. There are potential alternative family members who could also be considered when looking at utilising a gifted deposit. This is very much dependent on individual lenders so would require care when trying to find the right mortgage lender.
We often find that clients aren’t aware that their parents can help with their mortgage, or don’t feel like they can ask them to. The reality is that most parents are more than happy to help their children, wanting them to get on the property ladder.
Statistically, taking out a mortgage is better than renting, due to you being able to potentially pay less per month. The deposit can often come from inheritance, although parents have been known to gift it earlier on in life if they already have enough saved or have released a certain amount of equity from their own property.
Most lenders won’t accept a loan as a means of paying your deposit. This is down to the uncertainty that you’d have enough disposable income to pay back both the loan and the mortgage simultaneously.
There is no maximum limit on the amount of gift you can receive although I know of at least one Lender that insists you put in at least 5% deposit from your own funds.
The people who benefit the most from this tend to be First-Time Buyers in Lincoln and Home-Movers in Lincoln. It can also be useful when in conjunction with the Help to Buy Scheme in Lincoln, as the required 5% deposit, depending on the lender, can be paid via Gifted Deposit.
Generally speaking, all lenders will require a Gifted Deposit form. Depending on the lender, you may be asked to provide further proof and ID (things like donor ID or bank statements).
A Mortgage Agreement in Principle is what you are given once you pass the Lenders credit score to qualify for a Mortgage. Often shortened to AIP, this allows you to make an offer on a property you like. It’s can also be helpful when negotiating on house prices, as it shows the seller you’re serious about your offer and are prepared as a First-Time Buyer in Lincoln.
This is dependant on whether the lender decides to use a Hard Credit Search or a Soft Credit Search. Below are the differences between the two;
Hard Searches go more in-depth than Soft Searches. The main difference is that Hard Searches are likely to affect your Credit Score. If you have a good Credit Score however, you don’t need to worry going into this as a First-Time Buyer in Lincoln.
The more likely option these days is that a Lender will carry out Soft Searches. These usually needing less information and in most cases leave your Credit Score unaffected.
Although they can be a game-changer, a mortgage isn’t always guaranteed. The lender will need you to provide them with documents in order for the Underwriter to make a final decision.
There is often small print included on Agreements in Principle that may easily be missed. When customers reach out for assistance with their Agreement In Principle, at times we have found they’ve been turned away at full mortgage application stage.
The documents you will be required to provide can include; Identification, Payslips, Bank Statements and more. As your Mortgage Broker in Lincoln, we take pride in helping our customers, whether they are Moving Home in Lincoln or Self-Employed in Lincoln.
You may be able to get away with this, however, most estate agents will want evidence that you are able to proceed.
AIP’s usually need renewing after around 30-90 days, although this isn’t a worry. The main reason we recommend getting one so early is to avoid being told your dream home is no longer available for purchase.
Getting your Agreement in Principle sorted also means you don’t always need to buy the first house you see. It’s a simple process, so if it expires you can easily get another.
How much deposit you need to buy a property depends on your circumstances and what it is exactly what you are trying to do. Here we explore how much you might need given your own personal situation.
In years gone by 100% mortgages were readily available and indeed before their demise, Northern Rock was offering 125% loan to value mortgages, that is to say, if you were buying a property valued at £100,000 they would lend you up to £125,000 (where did it all go wrong?!).
Lenders need you to put down a deposit simply to reduce their lending risk. If they lend you 100% of the purchase price then for some reason you fall into arrears and they need to take possession of the property then it only takes a small dip in house prices for them to suffer a loss (and they don’t like that).
Also, there is a school of thought that says if you haven’t invested some of yours or your family’s money into your home then you might find it a bit too easy to “walk away” should the going get tough and you were struggling to meet your monthly payments.
If you are not in a position to save up say, 5% of the purchase price yourself then it could be argued that you’re not quite ready to get onto the property ladder.
If you can find 5% from your own resources then you could qualify for the Government’s Help to Buy equity loan scheme. This applies to new properties only.
You put in 5% and the Government loans you up to 20% to make up a 25% deposit. After 5 years you need to look at paying the equity loan back possibly by way of a remortgage or from savings you have been able to make in the meantime.
At the moment, yes 5% is enough in lots of circumstances. Not all Lenders will accept only a 5% deposit though so your options are more limited and normally you will need a reasonable credit score to qualify.
There are lenders out there that would consider you for a 95% mortgage with an average credit score but the rate of interest would be higher.
Many of the specialist Lenders want you to put down at least 15% deposit if you have a poor credit history, once again as above this is simply to reduce their risk in case a repossession occurs.
It is much more difficult to obtain this type of mortgage than it was in the mid-2000s but it’s not impossible.
You’ve always needed to put down a larger deposit for Buy to Lets and most Lenders at the moment are looking for 25%.
This could be possible but the vast majority of Lenders won’t let you do this, essentially this would still be 100% lending.
Yes, this happens all the time. Generally it’s “Bank of Mum and Dad” gifting or other family members but even family friends can gift you money as long as they can evidence the funds, prove who they are and confirm they are not expecting repayment of the gift.
If you are buying as a sitting tenant at a discount from the open market value, from a family member or if you qualify for a discount under the Right to Buy scheme then normally you don’t need to put any of your own money in as the equity is already “built-in” to the deal.
Please note that the above information is for reference purposes only and is not to be viewed as personal financial or mortgage advice.