Frequently asked questions

No jargon. No waffle. Just straight answers to your mortgage questions.

Which mortgage broker is right for me?
There are many reasons why you may wish to opt for a particular broker.

This may be based on previous clients’ reviews and recommendations i.e. you are confident of good service, it may be price-based – do they charge a broker fee or not?

It may be that you have a tight timescale and need to be confident that the broker will be able to work to these, it may be that they offer a specific, or niche, service where they are experts in the type of mortgage you are looking to obtain, or it may be that you simply get a good feel for the company when you deal with them e.g. efficient at coming back on queries, responsive to your situation, expertise in what they do…

In essence, there is no right or wrong answer. Given that a property purchase is the biggest financial commitment that you will ever make then spending the time to engage with some local brokers to sound them out and get a feel for them, reviewing reviews and looking through their website, understanding the level of service that you will get e.g. just advice, or advice with full administrative aftercare should all be taken into consideration when choosing the mortgage broker that is right for you.

What credit score do I need for a mortgage?

To qualify for the available rates in the market lenders will tend to want applicants to have maintained a positive credit score and not to have had any significant adverse credit on their file.

There are lenders that will look at the circumstances around previous adverse credit instances e.g. defaults, county court judgments (CCJ’s), etc.. and there are lenders that will still offer mortgages to individuals with significant credit impairment.

There is never any guarantee of a mortgage being offered, but if you do have previous credit issues then it is advisable to speak to a local mortgage broker who will be able to review your credit profile and advise you of the available mortgage and lender options.

How to get a Buy to Let mortgage
A Buy to Let mortgage is a mortgage taken out on a property that will be solely used to rent out to tenants.

The mortgage amount that can be borrowed is based on the rent that is likely to be achieved from the property and the applicant will typically need to have a 25% deposit to put down, as well as have some personal income to be able to cover rental voids, although there are lenders that will offer mortgages with a 20% deposit and also some lenders that do not have specific income requirements.

The mortgage can not be used for a property that you intend to live in, and they are typically taken out on an interest-only basis as they are seen as an investment property. A normal mortgage application is still required where the lender will assess the ability to maintain the mortgage payments, the credit history of the applicant, as well as the property.

Can you get a mortgage on an auction property?
There are options to be able agree on a mortgage on an Auction property. Due to the tight turnaround timescales on having to pay the balance of the agreed purchase amount at the time of purchasing the property at the auction, there may be other more suitable finance options so as to prevent you from losing the property and your deposit. It will also be dependant on the current state of the property e.g. if major refurbishments are required if it can be lived in as bought etc…

Prior to attending the auction, it would be advisable to discuss the property, and your plans for it, with a local mortgage adviser whereby they will be able to recommend the most suitable purchase finance options and put together any decision in principle applications to confirm that the finance will likely be available to you.

Can you get a mortgage with debt?
Yes, but it will depend on the level of debt, how well you have maintained the debt, and your overall financial position to be able to maintain both the debt payments and the mortgage payments.

A good mortgage adviser will be able to review the overall position that you are in and advise you of your options.

Can you have 2 mortgages on 1 property?
Yes, there are circumstances where some lenders will allow you to have a second residential mortgage, for instance, to purchase a holiday home that will be used solely for your family (and not be let); for work purposes e.g. you have a family home in Cheltenham, but work in London and therefore you need to live there for the majority of the week; for a dependant relative to live in, to name a few reasons.

The second residential mortgage will need to be affordable and the lender will take any current residential mortgage payments into consideration, and the lender may also require a larger deposit to be put down on the 2nd property to reduce their risk.

Based on the complexities around this type of mortgage it may be appropriate to speak to a local mortgage broker who will be able to assess your circumstances and plans for the property before confirming the best available options.

Can you get a mortgage with an Individual Voluntary Arrangement (IVA)?
In some circumstances, there may be options available if you have had an IVA in the past. This will depend on the circumstances around the IVA when it was entered into, how long you have been paying it for if it has been satisfied…

So there is no accurate answer to this query without fully understanding the exact position with the IVA, and your overall credit profile, to then be able to research the options that may exist to obtain a mortgage.

A good mortgage broker will be able to review your situation and then research the market to confirm if you will or won’t be eligible based on the overall situation regarding the IVA.

Can you get 100% mortgage?

Currently (2023) there are no 100% mortgages available on standard mortgages i.e. where you are purchasing a property from an unknown person at the property’s full market value.

There is the potential to obtain a mortgage at 100% if the property is being purchased on what is known as a concessionary purchase, most commonly where a property is being bought from a family member at a discounted price and the lender uses the effective equity that is being gifted (and forms the deposit) as part of the purchase to the family member buying the property, and also in rare circumstances where someone is buying a Shared Equity/Ownership property, but these options are not regularly available through most lenders.

If you feel your scenario fits with one of the above potential options where a physical cash-based deposit may not be required then contacting a local mortgage adviser is a good place to see what your options may be.

Will mortgage rates go down?

UK mortgage rates are based on 2 key elements, the overarching Bank of England Base rate and normal market competition e.g. if a bank has a surplus of cash at its disposal then it may look to offer lower rates than its competitors to lend this money quickly to save it being sat in their accounts.

In essence, no one can truly predict what will happen to mortgage rates as there are so many variables that need to be considered and therefore we are unable to comment on if we feel interests will rise or fall.

What happens when you pay off your mortgage?
When you pay your mortgage off completely then the house is completely owned by you, and all payments will stop.

At the point of repaying your mortgage, the bank will instruct the land registry to remove its charge over the property and the house will then be held solely in your name.

There may be a small administrative cost that the lender will charge to allow them to complete any work to remove their charge, but these differ based on the lender and your lender will confirm what these charges are, if any, as part of you fully redeeming your mortgage.

How to get a mortgage in the UK

To determine if you are able to obtain a mortgage then it is best to discuss your position with a lender or local mortgage broker as they will be able to determine your ability to meet the needs of the lender at application.

If you meet the needs of the lender then you can then apply for the mortgage following a successful house hunt, or at a suitable time to start the application process if you are looking to remortgage.

There is no hard and fast rule on who is able to get a mortgage, but you will need to be in a suitable financial position to be able to maintain the mortgage payments, and not be overly indebted, or have significant issues with your credit file.

If you would prefer to discuss your position prior to looking at properties, considering your options, then a local mortgage broker or adviser is always a good place to start as they can then review the mortgage market for you and confirm the right options available for your circumstances.

How reliable is a mortgage in principle?
A Mortgage in Principle, more commonly known as a Decision or Agreement in Principle is usually fairly accurate as it uses the information available, and a soft or hard credit check, to be able to determine someone’s financial position prior to submitting a full mortgage application that is then fully underwritten.

There are scenarios where a full application the underwriter picks up something on the credit search, or the income position is not quite what was entered based on being able to review physical payslips and bank statements, but in essence, the initial Decision in Principle will give a fairly accurate reflection of someones ability to obtain the mortgage when it is fully applied for.

What is a tracker mortgage?
A tracker mortgage is, in its simplest term, a variable mortgage. This means that it will most likely track the Bank of England Base Rate and be set at a level slightly above this rate.

This means that the rate can increase if the Bank of England rate increases or decreases should the Bank of England Rate go down.

What do you need to get a mortgage?
The main thing that lenders are looking for is your financial position i.e. your ability to maintain mortgage payments.

This will mainly be down to your income and debt position, but lenders will also take age, family circumstances (number of children), past credit history, etc… into consideration.

If you tick all the right boxes then there is no reason why a lender won’t grant a mortgage, but with so many variables it may be beneficial to discuss your circumstances with a mortgage broker or adviser as they will be able to confirm with confidence what your options are regarding obtaining a mortgage suitable to your circumstances.

What is a mortgage holiday?
A mortgage holiday is when the mortgage provider you are with grants you the option to freeze your payments for a short period.

This isn’t an option that all lenders offer, but if you are struggling to pay your mortgage for a short time is something that lenders may agree to, but there is no guaranteed to this option as it is down to the individual lender at the time of your request granting this option.

If you do take a mortgage payment holiday the amount that you don’t pay will still be added to the loan amount, with interest payable on this amount and the outstanding mortgage, so will have to be paid back at some point in the future.

What is an offset mortgage?

An Offset Mortgage is one where there is a savings account linked to the mortgage.

There is no ‘interest’ payable on the money held in the savings account, but it means that you only pay the interest applicable on the difference between the mortgage balance and the savings balance.

For example, if your mortgage balance was £100,000 and you had £50,000 in the savings account, you ONLY pay interest on the difference of £50,000.

If you have a large amount of savings, or save regularly, but want to retain access to the savings, then an Offset mortgage may be a good option due to the likely mortgage interest that can be saved over the term of the mortgage.

A good mortgage adviser will be able to recommend the best Offset option available to you if this is the right advice to give based on your circumstances.

How to apply for a mortgage
The first thing to consider regarding mortgages is what your ‘affordability’ is. In simple terms, this is how much lenders are willing to lend to you. Once you have found how much you can borrow, this will then drive the amount that you are able to purchase a property for.

The easiest way to find out how much you are able to borrow is to speak to a local mortgage broker as they will compare different lenders to confirm the maximum lending available to you.

Once you have then found the right property your mortgage adviser will then submit the application for you, along with any relevant evidence that the lender requires, and will manage the entire process for you, saving you an incredible amount of time and stress.

What is a mortgage in principle?
A mortgage in principle is an initial assessment completed by the lender where they look at the income position, debt position, lending amount, family position, and all other necessary income, including a hard or soft credit search, to be able to confirm ‘in principle’ that they would be happy to lend the applicant the money to purchase a home/property.

It is not a mortgage offer but gives a good indication of the ability to be able to apply for a mortgage and to be agreed to the mortgage assuming that all the information presented to the lender can be evidenced when a full mortgage application is submitted.

What is a Buy-to-Let mortgage?
A Buy-to-Let mortgage is a mortgage taken out on a property that will be solely used to rent out to tenants.

The mortgage amount that can be borrowed is based on the rent that is likely to be achieved from the property and the applicant will typically need to have a 25% deposit to put down, as well as have some personal income to be able to cover rental voids, although there are lenders that will offer mortgages with a 20% deposit and also some lenders that do not have specific income requirements.

The mortgage can not be used for a property that you intend to live in, and they are typically taken out on an interest-only basis as they are seen as an investment property.

What is a lifetime mortgage?
A lifetime mortgage is a mortgage generally available to people aged over 55 years old.

The mortgage is taken out with no requirement to have to repay the original mortgage amount until they die.

They are generally taken out on an interest-only basis where the interest payments are made monthly. There are options to repay the mortgage amount should the person move/sell the property or decide that they wish to repay the mortgage on a normal repayment basis.

They work like any normal mortgage in that they are based on the income and financial position of the applicant and a normal mortgage application process is undertaken.

How can I calculate a mortgage?
To calculate mortgage payments it is best to speak to a mortgage broker who will be able to work out the mortgage payments based on the amount borrowed, the applicable mortgage rate, and also the term that the mortgage is taken.

Most mortgages are taken out on a repayment basis and therefore the variables of amount, term, and rate need to be factored in.

If you were to take out an interest-only mortgage, assuming you met the qualifying criteria set by the lender, then to cost is simply the total loan amount (including any fees) multiplied by the initial rate and then divided by 12.

How much deposit do I need for a mortgage?
Typically deposits required by lenders range from 5% all the way up.

If you are able to put 5% of the property value in as a deposit and meet the necessary affordability and criteria by the lender then that is all you need.

If you are able to put a bigger deposit down then this will generally mean that you are able to obtain a better rate from the lender.

How long does a mortgage offer last?
Most mortgage offers last for 6 months for house purchases, and some lenders differ when it comes to remortgage offers but these tend to typically be valid for 6 months.

There are scenarios where these can be extended, but these are dependant on the specific circumstances around why it would need to be extended.

How long does a mortgage application take?
From the initial discussion with a mortgage advisor to physically applying for the mortgage depends entirely on finding the right house/being in a position to start the remortgage process can’t be given a timeline as every situation is unique.

However, from actually submitting the application then you will generally be looking to have a mortgage offer within 2 weeks of applying. This is dependant on being able to provide all of the correct information required by the lender and a valuation being able to take place on the property within these timescales.

The key is finding the right lender for your circumstances and a good mortgage broker will be able to advise you of your best options.

How much is a mortgage?
A mortgage will normally be agreed upon by the lender based on what they call ‘affordability’.

In essence, this means that a mortgage will be granted based on how much you’re looking to borrow, your current financial position, and how much you earn.

Most people will generally use roughly 25% of their net income to cover their mortgage payments, but there are a huge number of variables that makes this impossible to answer as every mortgage is different and therefore it solely depends on what you can afford, what amount you borrow, how long you agree to pay the mortgage over, and the rate applicable to the mortgage.

To discuss what it may cost you, based on your mortgage requirements, then feel free to contact us.

Is it possible to get a mortgage with bad credit?

In a word yes, there are a number of lenders that will accept applications from clients with previous poor credit histories.

The key is understanding what credit impairments you have had in the past, what these were for if they have been satisfied (or not), what your current financial position is and what your credit rating looks like now.

We have experienced brokers who are able to review your current financial position, review your credit profile and advise on the options available to you.

What is a mortgage?
A mortgage is effectively a loan secured against your home. It is generally taken out over a longer period than an unsecured loan and it is also likely to have a lower rate.

It is the mechanism to raise the funds required to buy your home or to purchase additional properties if you are in the financial position to be able to borrow the funds.

Call us today and we will happily discuss all you need to know about what a mortgage is, how we can help you, and to help you understand what position you are in to be able to borrow what you need to purchase a property.

How can I get a mortgage?
Getting a mortgage may seem easy on the face of it, but with so many options available, a wide range of lenders to choose from, varying criteria and lending requirements based on the different lenders then the best way to obtain the right mortgage for your circumstances would be to employ a qualified mortgage broker.

The broker will have in-depth knowledge of the lender rates, criteria, and affordability calculations and will be able to advise you on the right mortgage for your needs.

What mortgage products are available?

There are literally thousands of mortgage products available on the mortgage market and a huge variety of lenders that will look at a whole range of variables associated with your financial position.

If you are in a sound financial position with no adverse credit impairments then it will generally come down to who the best lender is for your circumstances, who will give the right rate for you, and who will be able to lend you the most or provide the most efficient service if your mortgage is urgent.

But, there are also a huge range of lenders that will look at various other financial circumstances differently from being able to use the most current up to date accounts if you are self-employed, to using benefit income, to look at any adverse credit that you may have on your credit file. The best way to find out if you are eligible for a mortgage and what your options are is to speak to a qualified mortgage broker who will be able to review your situation and then research the market for the right mortgage for your unique financial position and mortgage requirements.

How much can I borrow for a mortgage?
That is an extremely common question that we get asked.

How much you can borrow depends on a number of variables ranging from how much you earn, what debts you have in place that will continue, your family circumstances, your age, and your credit profile.

The best thing is to speak to a qualified mortgage broker who will be able to review your current financial position and then research the market to find out what the maximum affordability is for your unique financial position.

What can a mortgage Broker do for me, and why should I use one?
  • Advising on maximum borrowing – Not all lenders will lend the same amount, there are a range of factors affecting how much you can borrow and a good mortgage broker will find the best lender to lend the amount you need
  • Access to lenders and rates – Given the variety of rates and mortgage deals on the market a good mortgage broker will be able to find the best lender and the right deal for your specific circumstances. Some lenders also offer Broker Only rates which are often better priced than if you went direct to that lender.
  • Understanding of lender ‘grey areas’ – All lenders have criteria written down, but well versed brokers know what lenders will look at certain cases and even go outside of their criteria to agree different scenarios.
  • Managing the application process – A good mortgage brokerage will be able to manage the application fully, almost without involving you, from start to finish and in an ideal world just keep you informed of the progress to allow you to focus on what is important to you.
  • Advising on, and arranging all necessary insurances – A mortgage is the biggest financial commitment you will ever take on. Given no-one knows what is around the corner, everyone is susceptible to illness or injury, and death is unfortunately a certainty at some point in our lives we ensure that you have access to the right insurances to cover the worst that life can throw at you.
  • Overcoming obstacles – Some mortgage scenarios are trickier than others. A good broker will be able to navigate the questions and queries asked by lenders, and work with lenders to be able to overcome certain obstacles that may present themselves along the mortgage application journey.
  • Liaising with all the necessary parties, and keeping you fully updated on all aspects of the mortgage and purchase process – Put simply, we take on as much of the leg work in getting you over the line with completion on your purchase or remortgage as possible, so taking as much of the stress away as possible.
  • Assisting with completion when necessary, because not all completions are straightforward
  • Ultimately a good broker should take the stress out of a large portion of the process, and find the very right deal for your unique circumstances so saving you time, money and hassle.
  • Oh yes… there is also one other reason for using a mortgage broker in that they will find you the right deal in the market, that meets your specific circumstances, and will likely save you thousands of pounds over the course of each mortgage cycle. They are also there for ad hoc advice, supporting you when life changes occur.
  • The key question I would pose to anyone not thinking of using a mortgage broker is:

If you needed to re-wire your house then you would almost certainly employ an electrician (or the vast majority of people would), so why when it comes to the biggest financial commitment of your life would you not employ someone to find you the right mortgage deal time and again AND, who would almost certainly save you considerably more money over your mortgage than they are likely to charge for their expertise and service?

You’d be mad not to, right?

How does the Buying Process work?

Step 1 – Finding a property and agreeing on a purchase price

So, you have reviewed your circumstances and know what you can afford, and you have found the perfect property. Once you have negotiated and agreed on the purchase price the estate agent/developer will issue all parties with a memorandum of sale which will include all the necessary information for you and the vendor. This is not a binding contract but confirms the agreed purchase price at this point.

Step 2 – Mortgage application and instructing solicitors

The next stage is to confirm that you have found a house and had your offer agreed to your mortgage broker/advisor. They will then provide the necessary recommendations as well as gather all the necessary information and evidence required to submit your mortgage application.

At this point, you will also need to instruct a solicitor to open a file and start the preliminary checks to be able to act for you in your purchase.

Step 3 – Gaining agreement for the mortgage.

The mortgage application has been submitted and underwritten, all obstacles have been cleared and all additional queries have been satisfied for the lender to produce a mortgage offer.

Step 4 – Solicitor searches and making enquiries

Once the mortgage has been agreed and offered, your solicitor will start in earnest the rest of the work that they will have to do to ensure that the property you are buying is exactly what you are expecting. They may have completed some work, but without a mortgage offer, some solicitors will not want to do too much work as this will come at a cost if the mortgage isn’t offered and the purchase can’t complete.

The solicitors will carry out all appropriate searches (ensuring the property is registered property, boundaries are accurate, no disputes currently in place etc…) and also liaise with the acting solicitor on the vendor’s side to have any ‘enquiries’ (queries) satisfied prior to confirm they are happy for you to proceed with the purchase.

Step 5 – Managing the chain

If the property purchase is part of a ‘chain’ i.e. other purchases and sales that run from the bottom of the ladder to the top of the ladder then your solicitor will need to liaise with the other solicitors within the chain to arrange an appropriate exchange date – when all contracts are signed and deposits are sent up the chain.

Step 6 – Exchanging contracts

Once the chain has been agreed and everyone is ready, the solicitors will agree on an ‘exchange’ date. This is the moment that you sign the formal paperwork to say that you will, in law, buy the property. It is also the time that you will provide the deposit funds to be sent to the vendors, this will usually be an agreed percentage of the purchase price. At the point that contracts are signed and the deposit money is sent you are legally obliged to complete on the purchase. If you decide to not go ahead with the purchase at this point then you effectively forfeit the deposit money that you have put down.

Step 7 – Completion

Once the contracts have been signed at the exchange the solicitors will agree to a completion date. At this point, they send the Certificate of Title to the lender providing your mortgage as proof that everything is now in place to complete. The lender sends the mortgage funds to your solicitor and your solicitor will send these funds to the vendor’s solicitor to complete the purchase!

How does the mortgage process work?

The mortgage process can seem complicated but with the aid of a good mortgage broker everything should be taken care of seamlessly:

Step 1

A lender or mortgage broker will need to assess your current financial position to identify how much you can borrow.

Step 2

Once it has been established how much you can borrow, the lender or mortgage broker will apply for a Decision in Principle. This will include a credit score being conducted by the lender, and assuming that they are happy they will provide confirmation that ‘in principle’ they agree to lend the amount applied for.

This is not the same as a mortgage offer and on represents an informal agreement based on the limited information presented at this stage.

Step 3

Once you have found a suitable property it is time for the lender or broker to present their mortgage recommendations and submit the mortgage application. The recommendation will be based on your current circumstances and what is best for you in the short, medium and long term, and based on the discussions that you have had with your advisor.

Step 4

The mortgage application – this is that stage that ALL necessary information is disclosed to the lender, and all applicable evidence is provided by the applicant – pay slips, bank statements, current debt position, any commitments e.g. childcare, property information, address history, and adverse credit.

The lender will then take this information and fully assess it, or underwrite it, as well as performing a full, in-depth credit search on the applicant/s. The lender will also request for a valuation to be conducted on the property to ensure that it meets their criteria and is suitable for mortgage purposes.

This may be quick or take additional time if the lender has additional queries.

Step 5

Once the lender has completed all their necessary checks and fully underwritten the application they will then produce a mortgage offer**. This is a binding agreement that the lender will lend the money when requested by your solicitor.

**A mortgage offer is based on all the information remaining the same up to completing the mortgage, so some lenders will conduct a further credit search to ensure no additional borrowing has taken place in between offer and completion, and also if anything changes with income etc… then the offer can be withdrawn.

Step 6

Completion, this is the point where your solicitor has completed all of their necessary searches and had all enquiries answered by the vendors solicitors, or developers, solicitors and request the funds from the lender, to complete the mortgage. Once the funds have been paid to the vendor’s solicitors the purchase is complete and the property is yours!