The Pros and Cons of Using a Mortgage Broker in Durham

There are many reasons why you should use a Mortgage Broker in Durham. It can be helpful if you are taking that first step into the mortgage world, or going through the process the second time as you come towards the end of your fixed term as the process can be daunting sometimes.

With many options available for homeowners and home buyers, you ideally want to get it right first time, even with a lot of money involved.

Obviously, we believe that our tailored service as a Mortgage Broker in Durham would be helpful during the mortgage journey, in particular, First Time Buyers in Durham.

Even though we are experts in assisting customers through the process, it’s also understandable that the service is not for everyone and some may still wonder how we can help.

With this in mind, we have created a helpful guide about why approaching a Mortgage Broker in Durham could benefit you in your situation and why some people decide to go direct to the mortgage lender instead.

What are the pros & cons of using a mortgage broker in Durham?

Cost-Effectiveness

Deciding to go direct with the mortgage lender and finding your own mortgage deal can save you more money than approaching a Mortgage Broker in Durham. However, mortgage brokers may charge a fee but can be based on circumstances.

Being experienced in going through the process, having an easy case and lengthy knowledge may mean that it’s best and cheaper to go through the process yourself. This can be an issue if you have a more complicated case and people who don’t understand the lender criteria.

Going through the mortgage process with little to no knowledge could either result in you being on the wrong deal or ending up unsuccessful when applying for a mortgage deal. Either circumstance could mean spending more money than you have to, or damage your credit score which could negatively effect your chances of applying for a mortgage further down the line.

A dedicated Mortgage Advisor in Durham strives in getting your recommendation right the first time by finding you the best and cheapest deal on offer. As much as this service comes with a fee, you could find that you save a lot of money in the end.

Local Bank Branch Relationships

One of the reasons why many older customers decide to approach a bank is due to how the mortgage process was previously run. Prior to the introduction of online banking apps and modern technology, as a loyal customer, you may approach your local branch a lot where you would speak to the same people.

If you were looking to get a mortgage, you would go through the bank manager and speak to them. They had extensive knowledge of your finances and would be the ones to approve a mortgage for you. Now, many things are done digital including credit scoring.

Because of advanced technology within these banks, it means that the bank manager would not personally go through your case. It would be carried out through an online system which will determine if you are eligible for a mortgage or not. Regardless of what bank you are with, everyone is treated fairly.

Exclusive Mortgage Products

Following on from the previous point, there is an assumption amongst people that going direct would mean they are open to the best and exclusive deals. This is true to an extent, however, they will offer the best deal from their own company.

Not every mortgage lender is a bank and there is a large variety of options to choose from. Therefore, the most suitable deal your bank can offer, might not be the best one for you outside that bank.

This is another reason why taking out tailored Mortgage Advice in Durham can be a huge benefit to you. With an expert advisor by your side, they will be able to go through your case and find you the deal amongst our large panel of lenders that is perfect for your circumstance.

On the topic of exclusivity, approaching a Mortgage Broker in Durham can give you access to deals that you can’t find anywhere else. If you are a first time buyer, looking to remortgage in Durham or have a specialist case, there are many options available to you through an expert mortgage broker.

Changes to Regulation & Consumer Protection

After the 2007-08 credit crunch, the mortgage market needed to change. The 2014 Mortgage Market Review, stated that lenders could not sell mortgages to their customers without regulated advice.

This policy meant you couldn’t just approach a bank to tell them you want a mortgage and be accepted without the important checks. Furthermore, it meant that you couldn’t be granted a mortgage by any member of the bank, which was a regular occurrence, regardless of if they were qualified to do so or not.

Along with these new policies, consumer protection was introduced which was initially not provided to you by the bank. This means that you, as the customer, as the right to complain to the Financial Ombudsman if you feel misadvised in any way. The Financial Services Compensation Scheme is also available to you to make a claim.

Having this in place can assure customers who approach both mortgage brokers and mortgage lenders that they are in safe hands and are receiving professional and regulated advice.

Booking an Appointment with a Mortgage Advisor in Durham

One factor which can be a disadvantage to mortgage lenders but is beneficial to mortgage broker is that it can sometimes take months to try and speak to an individual at a bank. Whereas, getting in touch with a Mortgage Broker in Durham, like ourselves, can provide you with a more quick and responsive service that keeps you updated constantly about your mortgage process.

We are proud to offer a tailored service where a member of our team will contact you at a time that is best for you and your lifestyle. From morning, until late, 7 days a week, our expert Mortgage Advisors are here to help. This can sometimes include bank holidays!

Depending on availability, you may be able to book yourself in and have the appointment on the same day! However, it’s up to you if you want to speak to someone today or in a few days time.

As a part of our tailored service, our advisors have flexible availability. This means you can book yourself in around your 9-5 or around any other commitments. Our quick and simple book online system is great if you are on the move and need to book an appointment.

Responsiveness is an important part of Durhammoneyman. Whatever mortgage process you are going through, our friendly team will keep you in the loop. Your advisor will let you know of any changes that could arise.

The public’s views on mortgage brokers has changed due to Mortgage Brokers in Durham, like ourselves, providing an open and honest service to all customers looking to start their mortgage journey.

Handling Complex Scenarios

Through our time providing Mortgage Advice in Durham, we sometimes speak to customers who have a more complex situation than your average case. Below are just a few common situations we have encountered over the years;

• Mixed Deposit (Savings & Gift) – This means auditing two different sources.
• Applicants, who are on zero hour contracts – Will there be a consistent income?
• Making a Second Purchase – Can they afford to make that additional purchase?
• Self-Employed with No Fixed Income – A common challenge for Self-Employed applicants.
• Poor Credit History – A lender will not look favourably upon an applicant who has mismanaged payments in the past.
• Affordability – Can they afford a mortgage full stop?

In previous years, mortgage lenders could easily offer you deal that was better than any other lenders. Now, it’s not all about which deal you go with, it’s if you match the criteria or not.

Even if you find a deal that is reasonable, it doesn’t mean you match the criteria for it. In order to determine this, the lender will perform either a hard search (resulting in a footprint on your credit file? or soft search (leaves less of a footprint on your credit file).

One thing that could damage your credit file is being declined for an agreement in principle when applying for a mortgage. On top of that, if you are declined, it’s very unlikely that you will be given a reason for this which can be frustrating.

If you do speak to a Mortgage Broker in Durham like Durhammoneyman, we will be able to go through your case before, so you are prepared and in a position where you have a better chance of being accepted.

Here at Durhammoneyman, we have a large panel of lenders who offer a range of mortgage products. We will be able to match you up with deals and look to get you an agreement in principle. If you get your agreement in principle through Durhammoneyman, it will usually take no more than 24 hours after your free mortgage appointment.

Remember, having an agreement in principle doesn’t always mean you’re guaranteed to be agreed, nor does it guarantee a mortgage in the end, but it does provide safety for your credit file to have an expert go through your file beforehand. As a Mortgage Advisor in Durham, we always aim to get your recommendation right the first time.

In Conclusion; Should I use a Mortgage Broker in Durham?

At the end of the day, it’s your decision. As mentioned, there many advantages and disadvantages of going with a Mortgage Broker in Durham. On the other hand, there is many pros and cons to going direct as well. It all depends on how quick you want your service to be, and how secure you want to be.

Through our time as a Mortgage Broker in Durham, we have built up a positive reputation and strong relationship with many customers looking to begin their mortgage journey. If you are a first time buyer in Durham, coming to the end of your fixed term, looking to remortgage in Durham, we have done it all!

Here at Durhammoneyman, we offer fast & friendly advice that is FCA regulated. Simply book online or get in touch to book yourself for a free mortgage appointment or remortgage review with one of our brilliant advisors. Our goal is to fulfil your mortgage needs, by providing you with advice, at a time that best suits you, subject to availability.

For more information about our service, check out our fantastic customer reviews. You can have a customer insight on how our service has helped many individuals on their mortgage journey. We also offer free financial education through our YouTube Channel, MoneymanTV.

A Guide to Remortgages in Durham: Top Reasons to Consider

Remortgage Broker in Durham

The mortgage journey can come with its highs and lows, however, the ultimate goal will either involve you settling down in your dream home to start a family perhaps, a step up to get you further up the property ladder or an investment purchase to provide another income source.

Whatever route you may go down, both will eventually come to a point where your mortgage term will end. You might sell up and upsize/downsize into a new property. If you are a landlord, you might want to sell your portfolio to the tenant or another buyer and look at other options. One option that is the most popular is a Remortgage.

What is a Remortgage?

It’s best to start by understanding what a remortgage is. This term is the act of paying off a pre-existing mortgage using a new mortgage. There is a range of options when taking out a Remortgage, some being more major than others.

Below is a quick guide that we compiled that includes all the options you could when it comes to taking out a Remortgage utilising the 20 years plus knowledge of our resident “Moneyman” Malcolm Davidson (host of our YouTube channel MoneymanTV).

Remortgage For Better Interest Rates

So, your initial mortgage deal will usually last 2-5 years and include low fixed rates or possibly discounted rates. There might be a possibility that you will be placed on a tracker mortgage which means the interest rate will go off the Bank of Englands’ base rate.

If you aren’t on a tracker mortgage, you will likely be on the lenders Standard Variable Rate when your term ends. Also known as SVR, this is a mortgage with an interest rate that might change depending on how much the lender wants to charge. Unlike tracker mortgage, this will not follow the Bank of England’s base rate.

These can be seen as more expensive routes to take, which is why a lot of people may look at Remortgaging for better rates in order to potentially save money on their monthly repayments.

Remortgage for Home Improvements

You might find yourself in a position where you are 2-5 years into occupying your home and feel something isn’t right. It might be that you need an extra room or bigger living space for your kids/belongings. It might be some form of renovation such as getting a kitchen, office or loft conversion. In this situation, many look into releasing their equity with a Remortgage to cover the costs instead of to moving into a larger house.

The option to release equity in order to fund/manage your own projects might seem quite intimidating especially when getting planning permissions, however, it can be seen as more rewarding and less stressful in comparison to finding your new home, selling your current one and moving your belongings.

Furthermore, funding towards home projects that could make the house look a lot more impressive and appealing can be beneficial if you will sell it up or rent it out in the future as the property could increase in value.

Remortgage for Changes to Your Term

In some circumstances, many might look at getting a better mortgage term by reducing the length or switching to a more flexible product which is where they could Remortgage in Durham. The longer your term, the lower the payments will be over time. Therefore, reducing the length does mean you won’t be paying back your mortgage for as long so you aren’t exactly tied down forever, however, your monthly repayment will be a lot higher.

An option that provides benefits that can prove endearing to some homeowners is having a more flexible mortgage when they remortgage. This could give you the chance to overpay which could result in paying your mortgage off as quick as you’d like also being able to pass the same mortgage and rates over to another property, if you decide to move at any point in the future.

Although a flexible mortgage might sound perfect, it likely will come in the form of a tracker mortgage. As mentioned before, this mortgage follows the Bank of England base rate. This means that payments could fluctuate on a monthly basis depending on interest, therefore making them a little unreliable.

Remortgage to Release Equity

Equity is something that is in any property. The way the amount is worked out is through the difference between what is still owed on the mortgage and the current property value.

Like we mentioned before, this equity can be used to fund home improvements, however, there are more options for you out there.

You may equity is used to cover long-term care costs, to supplement their income, to have a holiday, to pay off an interest-only mortgage or to have free spending money.

If you are a Buy to Let landlord, you might remortgage to release equity as a way of covering your deposit for buying a future property for an addition to your portfolio.

For customers who are over the age of 55 and have a property that is worth at least £70,000, it may be worth looking at your options for Equity Release in Durham. Speak to a qualified later life mortgage advisor to learn more about Equity Release & Lifetime Mortgages.

Remortgage to Consolidate Debt

Some people use Equity Release for paying off any unsecured debts that they have accrued over time.

Paying off unsecured debts may sound like a simple solution, Debt Consolidation not only bases both on the amount you’re owed and the value of the property but also on your credit rating. Therefore, it could mean you are limited in the amount you can borrow.

On top of this, you will need to borrow more than your outstanding mortgage amount in order to pay off your previous mortgage and your debts. Because of this, your monthly repayments will potentially be higher. This may not be the best situation to be in, you can be assured in knowing that there are some options out there should you find yourself in an unfortunate situation.

In the case where you have damaged credit, there are still options to choose from, however, these may be difficult and require very Specialist Remortgage Advice in Durham before proceeding. Be aware that this might not be guaranteed.

You should always get mortgage advice before choosing to consolidate and secure any debts against your home.

Experienced Mortgage Advisors in Durham – Get in Touch

Getting in touch with an experienced and trusted Mortgage Broker in Durham would be very beneficial if you are reaching the end of your term and are exploring the options when it comes to Remortgaging.

With an advisor by your side, they can provide you with the support you need when looking into your circumstances and future goals so then you have the best route for you ready in the next step of your mortgage journey. We always aim for this process to be smoother and quicker than your first time.

Top 5 Mortgage Hurdles People Experience in Durham

Experienced Mortgage Advisor in Durham

Through our experience as a mortgage advisor in Durham, we have heard of our many clients’ different mortgage hurdles. Although these challenges are not entirely impossible to resolve, it’s vital to know that they can become a major factor in stalling the speed and flow of the process.

 These challenges could include:

• The effects that divorce and separation could have on a mortgage
• Unemployment and getting a new job
• Costs relating to childcare  
• Evidencing a deposit source
• Understanding benefit income

Effect of Divorce and Separation  

Divorce and separation can be hard to deal with and is very unfortunate. When this occurs, many divorced partners are then faced with more than just marriage challenges, with one of these being the joint financial endeavours that were taken out together. 

An option that initially sounded endearing to many married couples, due to the fact it can allow them to achieve their goal quicker, can quickly turn sour in the event of a separation. 

We tend to hear a handful of commonly asked questions from one half of the former happy couple when they get in touch. These include;

• What is the possibility of being excluded from their ex-partner’s mortgage?
• Could they possibly obtain a second mortgage?
• Is there a way to exclude their ex-partner from the mortgage, in order to keep it for themselves?

Considering the affordability of your mortgage payments is paramount. As well as having an expert Durham mortgage advisor, you need to ensure that you are fulfilling necessary income requirements that make the obstacle of divorce and separation easier to overcome.

Effect of Employment Gap and New Job on Mortgage Payments 

In some cases, getting a new job comes with a greater income level than your previous job. However, a gap between going from your previous job to your new job can become a complication with your mortgage, and it’s especially the case for mortgage lenders.

If you are starting a new job, some lenders are always willing to factor in the new job either in the first month or as soon as you are about to start it. Furthermore, you will find periods of probation are acceptable.

Childcare-related Expenses 

When dealing with mortgage-related issues, we have found that the mortgage amount can change depending on if you are a family with children or not. A family with children, for example, will be offered much less compared to a family without children.

This is especially true in cases where the parents have just started back at work and are in the process of managing childcare, which are known for having notoriously high monthly costs. Many mortgage lenders will view these the same way they view other large monthly outgoings such as car payments.

It is best to mention, however, that a number of mortgage lenders operate in a different way. In some cases, lenders dismiss childcare-related expenses as part of the outgoing costs. This is due to the fact they strictly operate based on the data presented by the Office of National Statistics for outgoing costs. This can potentially increase the mortgage amount.

Evidence of Deposit Source 

Anti-Money Laundering laws, put in place in the UK, tend to be quite strict. Because of this, it needs to be known where all funds deposited by the mortgage borrower are coming from. Evidence of the deposit source will be required by your mortgage broker and lender. Sometimes, it may even be required by estate agents and solicitors.

Due to this, the entire mortgage application becomes a lot more complicated. Regardless of the source of deposit (either gift, personal savings, property sale, premium bonds, or personal loans), there must be documents detailing how the funds were obtained.

What to Know About Benefit Income? 

Benefit income can have its challenges too! With the help of an expert mortgage broker, this can be easily tackled. In fact, all forms of benefit incomes can be taken into account from disability benefits to child tax credits, however, this depends on the views of the mortgage lender.

Get in Touch with a Mortgage Advisor in Durham

It doesn’t matter if you are a first time buyer in Durham, looking to move home in Durham, or looking to remortgage in Durham, challenges can come about and cause unnecessary stress. Get in touch with a mortgage broker like ourselves and we will try and help take the stress away. 

Mortgage Payment Holidays | Mortgage Advice in Durham

Mortgage Payment Holiday

At the start of the Covid pandemic, the Government promised that all borrowers would be allowed a three-month mortgage payment holiday if they needed it. Most lenders followed the Government’s guidelines and did their best to help their borrowers during these hard few months.

We feel that it is best to create a summary of what mortgage payment holidays are, what lenders are doing and who can provide you with help and guidance through the coming months.

On that note, we feel like this is a good time to talk about what mortgage holiday payments are and how they can help you with your mortgage payments.

What is a Mortgage Payment Holiday?

They are quite simple. A mortgage payment holiday is a set-period, agreed upon between you and your lender, bank or building society, where your mortgage payments are deferred. In this situation, the set period should be around three months.

You will still have to pay back these payments. Over the period, you will receive interest which will be added onto your loan at the end of the payment holiday whilst your capital balance will not decrease. So, your overall mortgage loan will slightly increase. So you save money in the short term but in the long term, it may prove expensive.

Once you feel like you are ready to start paying back your monthly mortgage payments, either your monthly mortgage payments will be recalculated at a higher level or your mortgage term could be increased. Lenders prefer to not increase your mortgage term as it could put you past their standard retirement ages.

You may even be allowed to pay off a lump sum later on in the year to get your monthly mortgage payments back on track to how they were prior to your payment holiday.

Mortgage payment holidays are available for borrowers with both residential or Buy to Let Mortgages in Durham. This really helps out landlords as they now have help if rental payments are affected.

The Government’s Proposal

Here is the Government’s proposal following the COVID-19 outbreak:

• Mortgage lenders will offer an automatic three-month mortgage payments holiday for borrowers who have been impacted directly or indirectly by COVID-19
• The mortgage payment holiday will apply to customers who are up to date on their payments, not in arrears, and wanting to self-certify that they are impacted by COVID-19
• This means that lenders will not complete an income and expenditure assessment, or an assessment of alternate payment options as ordinarily required under MCOB
• This proposal will allow lenders to be more responsive to customer needs and offer forbearance in a simple way to customers in an environment where the operation of collections teams made be also impacted by COVID-19
• Customers will be made aware that interest will accrue in the holiday period and they will need to make up deferred payments in the future
• Customers who wish to undertake a full assessment of their ability to pay or financial difficulty may still do so.

How do I apply for a Mortgage Payment Holiday

Even if you had a mortgage payment holiday before, we always recommend speaking to your Mortgage Advisor in Durham. They will sort out everything out for you and work out whether you actually need to take a mortgage payment holiday. You can also go directly to your mortgage lender and enquire about taking one but this may not benefit you as you may not even need one. The main thing is not to panic and explore all of your options before rushing into anything.

Here are the steps you need to take if you won’t meet/aren’t meeting your monthly mortgage payments and have been directly affected by the COVID-19 outbreak:

• The customer would contact the lender and inform them that they are being impacted
  by COVID-19
• The lender would accept these details from the customer and offer an automatic
  three-month mortgage payment holiday
• No evidence is needed for the lender
• The lender makes the customer aware that interest will accrue and will be contacted at the end of the three months to complete an assessment of the customer’s circumstances
• At the end of three months, an arrangement to pay will be agreed with the customer according to their circumstances to recover any shortfall, also ensuring that the mortgage remains affordable and sustainable
• The lender notifies the customer that if they wished to complete a full assessment now, there may be other forbearance options more suitable to the customer.

For more useful information on how the coronavirus could affect your mortgage click here.

Will a Mortgage Payment Holiday impact my Credit Score?

In most cases yes, they can give a negative effect to your credit score. However, you are taking one because of a virus so lenders shouldn’t let it damage your score.

To ensure that this is the case, before taking out a mortgage payment holiday, you must contact them. You need to record their answer as well as the date, time and the name of the person that you spoke with. This will avoid any confusion down the line if anything changes. It all depends on your lender, there is no guarantee that every lender will say the same thing.

Will I still be able to Remortgage or take a Product Transfer with my lender?

You would’ve thought that everything would continue as normal, however, all lenders are now avoiding all remortgages and product transfers during a mortgage payment holiday.

This will affect borrowers approaching the end of their existing product as they may be forced to move on to a higher lenders variable rate. This could mean that borrowers who act too early and jump into a mortgage payment holiday deal straight away could end up accruing interest on a costly variable rate.

This is another reason why we say don’t rush into anything! Take it slow and evaluate your options with an expert Mortgage Advisor in Durham first, they will make sure that you actually need to take out a payment holiday first before diving in headfirst. There are lots of mortgage options out there so have a look first with your mortgage Broker in Durham.

What are my other options?

Some lenders could offer you a temporary switch over to interest-only in order to reduce your monthly payments but not to add any more to the loan amount by still servicing the interest payments each month.

You don’t need to put all of your mortgages onto interest-only, but doing so could help you out financially.

If you have savings, remortgaging onto an offset basis could really help you out, you will be cutting down on monthly payments massively. For example, if you have a £250,000 loan and £50,000 in your savings, you would only pay interest on £200,000.

This may all may seem a bit stressful and it this may have come around faster than expected, however, you should try to take it slow and calm down. As your Mortgage Broker in Durham, we are still here to help and relieve you of all of that stress. Remember, we are still open as usual operating 7 days a week. Receive a free mortgage consultation with a Mortgage Advisor in Durham today, we hope that we can help you out!

Mortgage Advice in Durham

How to Improve your Credit Score in Durham

Mortgage Advice in Durham

What is a credit score?

A credit score is a tool that lenders use to measure an applicants ability to afford a mortgage. The higher your score, the more likely it is that you’ll be accepted for a mortgage. Which means that if you have a lower score, your chances of being accepted decrease.

Even though having a good credit score may look good on the outside, you must know that each lender has their own individual lending criteria and it’s more than likely that you won’t meet all of them. So sometimes it’s also down to your circumstances and not just your score.

Matching lender’s criteria

Most lenders’ criteria are completely different from one another, lenders have almost developed their own niche market. You could end up matching to a handful of them or maybe only a couple. As long as you end up securing a great mortgage deal that is all that matter though and it’s your advisor’s job to help you do that.

Whether you go with your bank’s in-house advisor or a Mortgage Broker in Durham, your personal and financial situation will be evaluated and then compared with lenders’ and their mortgage products.

We would always recommend approaching a Mortgage Broker in Durham before going straight to your bank’s in-house advisor and this is because your bank can only offer you their own products. If you choose a broker like us, we are able to access thousands of different mortgage deals through our large panel of lender’s. Once we have your details, we will try our hardest to match you to a lenders’ criteria.

If you are struggling to match a lenders’ criteria, it could be down to numerous different things. The most common reason why people don’t meet lenders’ criteria and get declined for a mortgage is because of their low credit score. If this is the case, then you need to try and improve it.

Improving your credit score

Avoid unnecessary credit searches

Having unnecessary credit searches on your file could have a negative effect on your credit score. Lenders’ don’t like seeing that you are repeatedly checking your score, they may think that there is a reason for it and they could even start asking you questions about it during your application process. Even using price comparison websites could damage your score.

On a side note, if you are applying for a mortgage, we strongly recommend that you avoid applying for any form of extra credit in the meantime. Paying back owed credit before your application will look good on your application, however, borrowing/paying back credit during your application will have a reverse effect. If you borrow credit, some lenders’ could think that you cannot afford the deposit and are relying on the credit to help you.

Are you registered on the Voter’s Roll?

A great way to improve your credit score is to register onto the Electoral Roll, it indicates stability and lenders really like that. It’s really easy to get yourself registered and the fact that it can increase your credit score, you’re missing out if you don’t take the opportunity.

If you are already registered, you should check that all of your information is correct as lenders will easily spot misspellings and an incorrect address.

Don’t run too close to your maximum limit

Maxing out your card each month will negatively impact your credit score. If you are using a credit card, a lender would much rather that you pay off the balance in full each month as it shows that you are good at managing your money. If you are exceeding your credit limits or overdrafts, your lender won’t think that you take your finances seriously. This could massively impact your credit score, especially if you get declined by a lender due to this reason.

Check that your address is up to date

When people move home, especially from their parent’s house, people often forget to update all of their address’. When you forget to update your address with a previous credit provider, it can appear that you live in two different properties at the same time. This can hurt your credit score once lenders see this so make sure that you are keeping on top of what address’ are linked with each of your accounts.

Close down your unused credit accounts

Do you have any store/credit cards that are no longer in use? If you do, then you should contact the provider and get them to fully close your account(s). Having these accounts open could be doing your credit score more harm than good. However, this could also still have a negative effect on your credit score as the credit reference can’t really tell if it’s you closing the account or the provider. Don’t worry though, it’s a good thing to check up on as if you have lost a card and didn’t realise then fall victim for fraud, you could end up having a worse effect on your score.

Remove your financial link to others

If you are financially linked to a family member or ex-partner your credit score could be affected without you even knowing. However, if the account is still live, you cannot remove your link just yet. If you want to remove any of these links, then you should get in touch with the credit reference agencies and make a request.

Summary

More often than not, applicants see credit scoring as an unfair way of determining the success of a mortgage application. For example, you may have a low score due to personal circumstances, which applicants think is unfair. As a Mortgage Broker in Durham, we mostly see that it’s people that are Moving Home or Self Employed struggle with their credit score. However, if this isn’t your mortgage situation and you still need help with improving your credit score, you know to get in touch with.

Sending an up-to-date credit report to your expert Mortgage Broker in Durham could prove extremely beneficial to your mortgage journey. A great tool that we always recommend to our customers is checkymyfile.com.

The more your advisor knows about your finances the better. Also, there are still some lenders that prefer to operate the old-fashioned way and will manually assess your application. They will still have rules that they stick by about the number of defaults and CCJ’s that they will allow.

A Mortgage Broker in Durham, like us, likes to do things the new way and will always aim to deliver you the same Fast and Friendly Mortgage Advice service that you are all used to. We hope to hear from you soon.

Divorce & Separation Mortgage Advice in Durham

Mortgage Advice in Durham

No one plans a divorce or a separation when you are buying a house, however, they do happen and things can turn the other way and become complicated. One thing that may turn complicated is your mortgage commitments with your ex-partner. If things do get out of hand and you’re struggling to manage everything on your own, just know that your expert Mortgage Broker in Durham is here to help.

Here at Durhammoneyman, we have dealt with thousands of specialist cases over our 11 years of working within the mortgage industry. This includes helping our customers overcome their mortgage doubts through a divorce or separation and trying to help them remove their name or their ex-partner’s name off of their joint mortgage. When our clients reach out to us for help with their mortgage and their divorce or separation, we usually get asked the same three questions:

1.        How do I remove my ex-husband/wife from my mortgage?
2.        How do I remove my name from my ex-partner’s mortgage?
3.        Can I have 2 mortgages?

How do I remove my ex-husband/wife from my mortgage?

It can be tricky trying to make changes to your mortgage, especially during a divorce or separation. You have to remember that both yours and your partner’s names are on the mortgage and you can’t just take one off like that.

The situation can get a little more complicated if there are children involved as there are the questions of who will live with the children and will it be in the current or a different home. We usually see that it is the mum that stays in the current household but it can be either.

There may come a time that whoever is “in situ” wants to take over the mortgage in their own right. Sometimes, both parents may want a fresh start in new homes of their own.

You need to be aware that even if you are able to prove that you have been paying your mortgage payments without any help from your partner, it will not change that their name is still tied into the mortgage deal. Even if they have moved out and aren’t helping out with any of the payments, their name is still on the mortgage and you need to get it removed.

Removing a name

You can do this one of two ways. You can either go directly to your lender to ask about removing a name by yourself or get the help of an expert Mortgage Broker in Durham, like Durhammoneyman.

Either way, they will have to be certain that the remaining applicant on the mortgage will be able to afford a mortgage on their own in the future. The way that this will be checked is through an affordability assessment, you will have to take one of these regardless of whether you have been keeping up with your mortgage payments or not.

Normally, during this point in the process, there is already someone who can step in and replace the ex-partner. This is typically a family member, friend or another partner.

You need to remember that every lender has their own unique way of assessing your affordability so don’t worry if your current lender says no. There are other options available, for example, you should approach a Mortgage Broker in Durham, like us who will try their absolute best to help you!

How do I remove my name from my ex-partner’s mortgage?

Removing your own name is similar to removing someone else’s, the basic ground rules apply for both. Firstly, both of your names are on the mortgage, so even if you decide to leave the family home, you are still responsible for any joint financial commitments you took out with your ex-partner. The only way to get your name off the mortgage is by going directly to your lender or with the help of a Mortgage Broker in Durham.

The mortgage payments for your old property will be taken into consideration if you want to buy a new property in the future so it is important that you take this into consideration before making an offer. This is why we always recommend getting help from a professional Mortgage Advisor in Durham.

Before you make an offer in the future, you must consider that your mortgage payments for your existing property will be taken into account. This is why we advise that you get Specialist Mortgage Advice in Durham; you may have forgotten this and your income may have changed meaning that you can’t really afford a mortgage as of yet. If you apply and get declined, you could potentially leave a negative effect on your credit file.

You will always find that some lenders are stricter than others which will affect how much they will lend you. If you come to us for Mortgage Advice in Durham, we will take this into account when recommending the most suitable lender to apply for a mortgage agreement in principle with.

Can I have 2 mortgages?

Yes, you can have multiple mortgages and even more than two if you want! Lenders and their credit scoring systems will take different factors into account when you apply for a second mortgage. One of the main deciding factors will be your current financial commitments.

If you still have ongoing commitments and you fail the lender’s affordability assessment, you could potentially damage your credit score. This is why we always recommend that before you apply directly with a lender you should go to a Mortgage Broker in Durham.

A Mortgage Broker in Durham, like Durhammoneyman, can perform a search for you without damaging your credit file to check whether you will be able to afford a mortgage. We can calculate your maximum borrowing capacity which can allow us to get an idea of your budget and how much your monthly mortgage payments are going to be on top of your current financial commitments.

Having an expert Mortgage Advisor in Durham by your side every step of the way could prove highly beneficial. Moving Home can already be stressful enough!

An Advisor will be available to answer any questions that you may have along the way and be recommending you with the best route to take at all times. We want the best for you through these tough times! Contact your Mortgage Advisor in Durham at Durhammoneyman today and receive a free mortgage consultation!

Specialist Mortgage Broker in Durham

Coronavirus & the Mortgage Market | Mortgage Advice in Durham

Coronavirus impact on the mortgage market

As you might’ve seen, the coronavirus has hit the mortgage market hard. Everything is changing rapidly and sometimes it’s hard to see what’s actually going on. This is why we think that it would be best to calm things down and catch you up with the latest updates on the coronavirus and its impact on the mortgage market. Here is a short video from MoneymanTV to explain what is happening:

Mortgage Surveyors

Before your lender accepts your mortgage application, the property will need a valuation. However, since surveyors and mortgage valuers can’t go and visit the property, lenders have put a hold on processing applications.

Some lenders use AVM’s (Automated Valuation Model) for valuations on properties. This means that lenders don’t have to rely on a surveyor or a mortgage valuer to go out and do everything there and then in the property. The problem with AVM’s is that they can only be used on restricted mortgages and on lower loan-to-values.

In recent days, we have seen that lenders have decided to decrease their maximum loan-to-value down to 60%. This means that they are still processing these applications but not necessarily ones at higher loan-to-values.

A lender’s view

We have seen that every lender is taking their own viewpoint. The main thing is that we haven’t seen any lenders withdraw a single mortgage offer yet. We estimate that they are just waiting it out and seeing what happens. A change could happen in the coming days, weeks or even months, we can’t possibly tell.

Furthermore, lenders have extended the periods of their initial mortgage offers from six months up to nine. They are letting the economy and the mortgage market get back on track.

Mortgage Payment Holidays

We talked about Mortgage Payment Holidays last week in another article but we feel like we need to clarify a few things. Firstly, they are not free money, you should only take a payment holiday if you absolutely need one. You should speak with your Mortgage Advisor in Durham who will go through all of your mortgage options and check whether you actually need to take one out before you go to your lender.

Lenders are more than likely to just extend the period of your mortgage anyway. If this is the case, it may be best to just hold off for a bit. If you are certain that you are not going to meet your monthly payments and you want to take a mortgage holiday, then you should get in touch with your lender as soon as possible. Lenders are asking for their borrowers to get in touch online rather than phone up and this is due to the thousands of calls they are receiving every day. You are more likely to get through online too.

It’s essential that you check with your lender that taking out a mortgage payment holiday will not damage your credit rating or mark any arrears against your account. Make sure that you do not cancel your direct debit and remember that you will need to get permission from your lender to take out a mortgage payment holiday.

Speak to a Mortgage Advisor in Durham

We know that everything is getting stressful and could become a little too much. That’s where we come in, your Mortgage Broker in Durham is here to help. We want this to all blow over as much as you do. The mortgage market will hopefully resume to how it was soon.

We can’t change any of this, so we got to get through this together. Your Mortgage Advisor in Durham is available to answer all of your mortgage questions 7 days a week. We can see whether you need to take out a mortgage payment holiday or just give you advice on anything mortgage that you are concerned about. We hope that you get in touch soon!

This article was originally published on 30/03/2020 and as of 20/05/2020 the property market has now resumed and this information has become outdated. Everything was 100% accurate at the date that this article was published.

Mortgage Broker in Durham

Can I Have 2 Mortgages? | Mortgage Advice in Durham

Second Mortgage Advice in Durham

Most people don’t want to think about having a second mortgage, one already stresses them out enough! Having more than one mortgage can prove quite costly it certain cases. Surprisingly, with that said, they are a lot more people that have more two or more mortgages than you would’ve thought. Here are some reasons why people may want to invest in more than one mortgage:

Common reasons for wanting 2 mortgages:

1. Do you want a second mortgage to raise money for your existing home?
2. Are you looking to rent out your existing home and purchase a new one?
3. Are you looking to help your children out with a second mortgage?
4. Do you require a second mortgage to purchase a Buy to Let property?
5. Is your name on an existing mortgage and you are looking to buy a new property?

Second Mortgage to raise money

Sometimes, people who have built up equity in their home may start looking for a second mortgage and this is because they want to release some of their equity to fund another purchase or something else.

If this is the same situation that you are in and you are thinking about releasing equity for a second mortgage, then you are going to need another mortgage deal to transfer onto. You can either search round for your own deal or go to a Mortgage Broker in Durham and they will sort it for you.

As a trusted Mortgage Broker in Durham, we have over 38 different lenders on panel, each with unique mortgage deals. We can shop around for you, searching through thousands of different deals until we match the perfect one for you and your personal and financial circumstances. Remember that lenders do not reward loyalty and will probably be offering better deals to First Time Buyers in Durham over you!

Second Mortgage to rent out existing home to purchase a new one

This is called a Let to Buy mortgage. Sometimes people want to keep their existing property and the mortgage so when the move home, they keep it with the aim to rent it out. When you are Moving Home and you decide to go down the Let to Buy route, your second mortgage will become your new residential one.

Second Mortgage to purchase a home for your children

More and more First Time Buyers are struggling to take that first step onto the property ladder without a helping hand. We are commonly seeing more and more Parents and Grandparents helping out. The most common situations that we see is that either the Parents or Grandparents of the applicant give up their home and move out to get a second mortgage or they actually purchase the second home for them (kind of like a gifted deposit).

Second Mortgage for a Buy to Let

Are you interested in a second mortgage for a Buy to Let in Durham? If so, you should speak to a Buy to Let Mortgage Advisor in Durham at Durhammoneyman. We have helped hundreds of Buy to Let landlords secure amazing mortgage deals in the past and we want you to be next.

Get in touch and let’s get the ball rolling for you and your Buy to Let second mortgage in Durham.

Named on an existing mortgage and want to buy a new home?

Are you currently named on another mortgage and would like to buy a new property to live in? This situation always comes about, and unfortunately, it is almost always down to a divorce or separation. In situations like this, 9 times out of 10 we are able to help. Having a Specialist Mortgage Advisor in Durham by your side during this hard time could really help you out.

Here at Durhammoneyman, we are able to search through thousands of second mortgage deals for you. A Mortgage Advisor in Durham will work endlessly until they have that 1/1000 perfect deal for you. Receive a free mortgage consultation today at Durhammoneyman, your expert Mortgage Broker in Durham.

Mortgage Advice in Durham

How Much Deposit Do I Need For A Mortgage In Durham?

How Much do I Need for a Deposit?

We have been in the mortgage business for a very long time now. We also know how hard it can be to get a mortgage. It used to be easy, prior to the credit crunch, lenders were handing out mortgages here and there. After the credit crunch, lenders became stricter and were only offering 100% and even 125% mortgages. After it was practically impossible to get a mortgage in 2007, the market eased out and returned to a relaxed state. Lenders turned back to 95% mortgages.

If you have a family or are living in rented accommodation, it can be quite hard trying to find the perfect first home that is affordable. We always get asked lots of questions regarding deposits and how much you will need. We frequently get asked these questions from First-Time Buyers in Durham:

Is Putting Down More Than a 5% Deposit Better?

Yes, putting down a deposit of more than 5% can massively increase your chances of getting accepted for a mortgage. Laying down a greater deposit could also lower the rate of interest that your lender offers you. By doing this, you are proving to the lender that you are financially stable. You are making yourself appear as trustworthy and they will know that you are not a risk. Lenders offer their products in brands of 5%, e.g, 95% mortgages are the most costly, followed on by 90%, 85%, etc.

Can I Take out a Personal Loan for the Deposit

Yes, you can, although, we don’t recommend it as lender tend to not like it. They see it as you can’t fully afford the 5% deposit and you need help to reach it. They will also take this new loan as one of your recurring monthly credit commitments. Therefore, you will get a smaller mortgage than you would’ve without the personal loan but you are basically borrowing two lots of money equating to the full 100% of the mortgage. This is why they can be put off by this.

Do Lenders Accept Gifted Deposits for a Mortgage

Most lenders do yes. It is very unlikely that you will find a lender that will not accept a gifted deposit. As long as the gifted deposit is not a loan, then the lender should accept it. The family or friend who is gifting you the deposit must provide ID and information on where the funds have come from.

First-Time Buyers in Durham usually get on the property ladder this way, they receive a gifted deposit from a parent or a friend. They usually understand how hard it can be to meet that 5% so they help them get on the property ladder.

Evidencing the Deposit

You will always need to prove to lenders where you have received money from and prove your monthly/yearly income and outgoings. Lenders need to make sure that you will be able to pay off your mortgage after putting down your deposit. The longer that you have been saving for a deposit, the more that it will benefit your application. Saving money shows the lender that you are good at managing your money.

If you have deposited a large amount of cash into your account recently, you will need to prove to the lender how you got this. For example, if you are selling a car, you will need to show them a receipt, prove how much you sold it for and show that this price matches your deposit into your bank.

You have to be careful when you are depositing large sums of cash at once as it could look suspicious on the lenders part. So make sure that you can prove where you have got it from. The longer that these sums have been in your account, the easier the whole process is.

The hardest part of the application can be proving the source of your deposits as sometimes they can be hard to get a hold of.

If you are selling a property, then your Estate Agent will give you a Memorandum of Sale to use as proof.

Help to Buy Equity Loan and Newly Built Home Mortgages

There is still a minimum 5% deposit if you qualify for the Help to Buy Equity Loan scheme. On this scheme, your deposit can be topped up to 25% which all depends on the loan you get through. This will give you a lower rate mortgage.

Remember that the loan that you borrow from the government will need to be paid off within 5 years. It’s not a gift of them, so if you fail to meet the 5-year deadline, then you will start to receive interest on the loan payments.

If you already know about the Help to Buy Equity Loan, this should make sense.

Agreement in Principle & Soft Credit Search Mortgage Advice in Durham

Credit Searches Explained | Mortgage Advice in Durham

More and more people these days pay much closer attention to their credit rating. Consumer awareness of credit scoring is higher now than ever before and I’d say at least half of people who contact us for the first time have already looked at their credit report online. There are many different credit reference agencies out there, most people will have heard of Experian or Equifax, but we recommend potential new clients to use Check My File for a 30-day free trial, which is £14.99 a month thereafter and can be cancelled at any time. This report “sweeps” several of those reference agencies and collate the information into an easily understandable colour-coded report.

Often, clients ask if we will be doing a credit search on them because they are aware that too many searches can have an adverse effect on their credit score. Lenders always run credit checks but we always seek a client’s permission before doing so. There are 2 different types of credit searches that Banks can run on a customer: hard searches or soft ones.

What is a Hard credit search?

A hard credit search is an in-depth look at your credit report and any financial institution carrying out one of these should seek your permission to do so. The advantage of a “hard” search is that because the lender is looking into your situation quite closely, if you pass the credit score then it’s fairly likely that your application will ultimately be successful. The only thing that can really go wrong from then on is if for some reason you cannot provide satisfactory documentation to back up the information you have disclosed or it turns out you have provided false details.

The bad news about a hard search though is that it leaves a “footprint” on your credit file so that anyone who looks at your report in the future can see you have had a search carried out. This isn’t necessarily a bad thing, but if you have several footprints registered in a short period of time then it could look like you applying for lots of credit at the same time. The footprint does not state whether your application was successful or not but if you have several searches over a few weeks then Lenders’ systems could wrongly assume you are being declined on the basis that “Why else would you go to Lender number 2 unless Lender number 1 had said no?”.

The odd hard footprint on your record from time to time is no big deal so there’s no need to worry too much about this, just be careful not to have too many.

What is a Soft Credit Search?

A soft credit search is a “lighter touch” look at your financial situation and this is the kind of search that would routinely be carried out on price comparison websites to give you an indication of what products might be available to you, or if someone wants to verify your identity. Some mortgage Lenders do soft searches in the first instance and more and more Lenders seem to be changing to doing this type of search. Whilst the financial institution doing a soft search obtains less information about you than if they had done a hard search, an Agreement in Principle from one of these Lenders is usually still an extremely strong signal that your full application will be accepted.

The really good news about soft searches is that whilst you will be able to see that someone has carried out a soft search on you if you check your credit file (people are often very surprised how many soft searches have been carried out on them!) these searches are not visible to other Financial institutions like Banks. This means that you can apply for an Agreement in Principle for a mortgage without it damaging your credit score irrespective of whether it is successful or not.

If you are wanting to Make An Offer On A Property in Durham I always think it is an excellent idea to have your mortgage agreement in principle in place prior to contacting the Estate Agent. You want to give yourselves the best possible chance of securing the property you want at the lowest price so if you can present yourselves as having your finances in place then you are definitely putting yourself in a stronger position. Having the Agreement in Principle also sometimes puts the Agent off trying to “cross-sell” their own in-house mortgage services to you.