If you are a homeowner with a mortgage to your name, you may notice that a certain amount of high street mortgages that are on the market are portable.
A portable mortgage in Scunthorpe works by taking your mortgage from one property to another if you decide to move home and want to avoid the penalty charge for doing so.
For those looking to move into a new home and are already going through your fixed rate mortgage deal, a portable mortgage could be helpful as you will have the potential to avoid having an Early Repayments Charge (ERC) for moving.
Remember, not every mortgage deal that is available on the market is portable. This is even less likely if you are on a mortgage with a specialist mortgage lender because their mortgage is probably more complex to qualify initially and they would discourage you to port it.
In order to find out if porting a mortgage will be available to you, we would highly suggest that get in contact with your mortgage regarding this.
In some cases, a homeowner may decide that option is not fit for them and choose not to even if their mortgage is flexible enough to achieve this.
There is a range of reasons why customers may not look to port their mortgage. For instance, the mortgage lender may not be willing to provide the additional funds or the different interest rate in those funds.
With this in mind, it may be best to accept the Early Repayment Charge (ERC) and move to a different mortgage lender altogether, however, this only applies if it works out cheaper to go to that new deal.
This is when an account will be attached to your mortgage when you look to port it and the extra funds will move onto a deal different from your original mortgage.
Due to this, each of these will be on two different rates of interest that are applied on both the mortgage and the direct debit.
Keep in mind that because products can overlap, it can become an issue further down the line which means it might need looking into in the future so they are realigned. With this, it may mean one of the sub-accounts falls onto a lender’s variable rate briefly.
For those looking to Move Home in Scunthorpe or are looking for a Buy to Let in Scunthorpe, contact and speak to a mortgage expert.
Through our 20-plus years of experience as a Mortgage Broker in Scunthorpe, we take pride in helping thousands of mortgage applicants in circumstances like this and will work hard in supporting you towards achieving your mortgage goals.
A 95% mortgage is as simple as the name would suggest; you are borrowing against 95% of the price of a property, and then you are covering the remaining 5% with your deposit. An example of this is if you looked at buying a property that was worth £150,000 with a 95% mortgage, you would be putting down £7,500 as your deposit and borrow the remaining £142,500 from the lender.
Off the back of the March 2021 Budget, Boris Johnson announced a Mortgage Guarantee Scheme for mortgage lenders, making 95% mortgages more readily available from the bigger high street banks.
This is fantastic news for First-Time Buyers and Home Movers alike, as this scheme will continue running until December 2022. Certain terms and conditions will apply though, which is something your Mortgage Advisor in Scunthorpe will be able to look at, to see if you qualify.
All our customers who opt to Get in Touch will receive a free, no-obligation mortgage consultation where one of our dedicated mortgage advisors will be able to make a recommendation on the best possible route for you to take.
95% mortgages are usually accessible by both First-Time Buyers in Scunthorpe & those who are Moving Home in Scunthorpe. Whilst saving for a 5% deposit sounds like a pretty straightforward concept, you’ll still need to have an acceptable credit score and prove that you are able to afford your monthly mortgage repayments, in order to access a 95% mortgage.
A good credit score is essential in the process of obtaining any mortgage, especially a 95% mortgage. Things like paying any current credit commitments on time, ensuring your addresses are updated and checking that you’re on the voters roll, can all help with your credit score.
Affordability is another one that is important to take note of. By giving the lender details of your income and monthly outgoings (things like your bank statements will be necessary for this) and any pre-existing credit commitments, your lender will be able to get a general overview of whether or not you are able to afford this type of mortgage.
Nowadays we see lots of family members helping each other get onto the property ladder, especially parents looking to further their children’s lives. The way this usually happens is by gifting the person looking to find their home, the deposit required. Known through the industry as the “Bank of Mum & Dad, Gifted Deposits are only intended to be a gift, and not as a loan. The lender will need proof that this has been agreed, before it can be used towards your mortgage.
When looking for a 95% mortgage, you want to make sure you have the right type of mortgage. Each mortgage type works differently, with that choice allowing you to find one that is most appropriate for your personal and financial situation.
Some homeowners and home buyers prefer Fixed Rate or Tracker Mortgages, mortgage types which mean you either keep interest rates at a set amount for the term given or have your interest rates tracking the Bank of England base rates.
Alternatively, you might find that Interest-Only or a Repayment Mortgages are more your style. Interest-Only allows cheaper payments until you need to pay a lump sum at the end (mostly now used for Buy-to-Lets), whereas a Repayment mortgage (a normal mortgage if you’d like) means you’ll be paying interest and capital combined per month.
Seeing as a mortgage is such a large financial outgoing, you need to be prepared and need to be aware. You might find things like higher interest rates, remortgaging difficulties due to less equity and then negative equity all cropping up if you’re not.
There is no need to worry though, as all these can be avoided if you’re savvy enough with your process to begin with. The more deposit you put down for a property, the less risk the lender will see you as.
A larger deposit, of say 10-15%, would not only reduce the rates of interest by a noticeable amount, but would also give the property more equity and reduce the risk of negative equity, thanks in part to you borrowing less against the property.
So, whilst the risks may seem intimidating, planning ahead and saving for a bigger deposit to access something like a 90% or even an 85% mortgage will be a massive help in your mortgage journey and something you’ll be able to reap the rewards from in the future.
So, you’ve saved up for your initial mortgage deposit, whether it be from your own savings or a gifted deposit from your parents. What’s the next step for you to take? It’s time for you to get prepared for your mortgage journey!
First of all, we would recommend that you get in touch with an experienced mortgage broker in Scunthorpe as early on as you can, especially if you are applying for a first time buyer mortgage in Scunthorpe.
This is because you’ll be able to get a general idea of the costs and how much you could borrow. You should also look to get yourself an up to date credit report, to make sure you know you’re in good credit and are able to pass this on to your mortgage advisor in Scunthorpe.
The last thing you want is to have disputed payments holding you back, so it’s always handy to check in the early stages. Taking these steps will set you on a course where you have a good idea of what your budget will be and how likely you are to achieve mortgage success.
Your mortgage broker in Scunthorpe will be able to get you an agreement in principle for you, on your behalf, typically within 24 hours of your initial mortgage appointment.
This helps you out greatly, as you will have this document to hand for making offers on properties. Having your agreement in principle shows the seller of the property and the estate agent that you are ready to go, allowing for a possibly quicker process.
There’s always lots of paperwork required for a mortgage process, so you’ll need to make sure you have a folder to keep all of these together. Two of these are your proof of ID and proof of address. For proof of ID you’ll need photo ID such as a driving license or passport.
Non-UK Nationals working in the UK will need to provide a Visa as well. For proof of address, you will need to use something like a utility bill or original bank statement that has been dated within the last 3 months.
You can also use your driving license, though it can only be used for one or the other. That means those using it for photo ID cannot use it for proof of address and vice versa.
The analysis of your spending habits will be one of the most important determining factors in whether you’ll qualify for a mortgage or not. You’ll need to provide the last 3 months bank statements, as that should evidence your income and regular expenditures.
Mortgage lenders will not be happy to see things like gambling transactions on your account, with the same being said if you go over an agreed overdraft limit or if your direct debits bounce regularly.
For the purposes of anti-money laundering, you will also need to be able to prove that you do in fact have the funds in place for the deposit and where that money came from.
Try not to move money around various accounts too much, as it will make evidencing the audit trail more difficult. Mortgage lenders like to see your savings building up so you’ll need to account for any large credits that go into your accounts.
Quite often, the money for your deposit will be gifted by a member of your family. This is common with first time buyers in Scunthorpe. The funds for gifted deposits need to be evidenced, with the donor signing a letter to confirm it’s non-refundable and not a loan, purely serving as a gift.
It’s a good idea to do plenty of homework in advance and come up with an estimate of you expected outgoings once you have moved into your new house as a first time buyer in Scunthorpe.
You’ll need to work out things like council tax and what your general utility bills will be, as well as regular spendings such as food and drink, to be able to determine how much disposable income you will actually have available, to use towards your monthly mortgage payments.
As you can see from the above, it’s a real paper trail when you are applying for a mortgage, but if you want your application to run like clockwork you’ll need to put the time aside to get everything together.
Our view is that it’s better to get all this at the outset and collate everything that a mortgage lender could possibly ask for. This saves time and frustration later down the line. Book a free mortgage appointment today and we will help you to prepare as best as we can.
Since this is one of the most common questions that we receive from First Time Buyers and Home Movers in Scunthorpe, we thought that it would be a great idea to cover “What is a property survey?” and the different types available.
When you have an offer accepted on a property your next job is to arrange a property survey. This will establish the condition of the property and ensure that it is worth what you are going to pay for it. If something is found on the survey you are then in a position by law to approach the seller to negotiate a price for the works required.
Here’s a short video from the Royal Institution of Chartered Surveyors (RICS) that explains the different types available to you.
There are 3 main types of property survey available to you:
A basic valuation is the cheapest option and you will be required to have one of these before you receive your mortgage offer. Please don’t confuse this with a full survey. The mortgage valuation confirms to the lender that the property is worth at least what it is lending you.
Your mortgage lender may even offer you a free basic valuation as part of your deal.
A Mortgage Valuation will not highlight any repairs that are needed. However, it may point out any obvious defects and recommend that you investigate further.
A Homebuyer’s report will cover structural safety and highlights problems, including damp, as well as anything that doesn’t meet current building regulations. This kind of report will give you an independent report of your property by an expert.
To ensure you are not paying for two surveys it is advisable to ask the mortgage companies surveyor to carry out this report for you – it will usually take a couple of hours to complete.
A Full Structural Survey is advisable for older properties and those of a non-standard construction.
Depending on the property size and type – a full structural survey can take as long as a day to complete.
A full structural survey provides a detailed report on the condition of the property and highlights issues that should be investigated further before going ahead with the purchase, providing you with peace of mind about the condition of your property.
You can find a surveyor to carry out a Homebuyer’s report or building survey through the Royal Institution of Chartered Surveyors.