At any one time, there may be hundreds of different mortgages available. It can be very time consuming for you to establish exactly what mortgage is right for you and at the end of the day, how can you be sure it is the most competitive available?
You might be:
- Moving to a new house
- Looking to re-mortgage and/or raise additional money
- A first-time buyer
- Buying an investment property to rent out
We can save you both time and money, by assisting you to select the best mortgage available and helping you to complete the large amount of paperwork that goes hand in hand with most mortgages. We deal directly with mortgage companies to ensure everything is completed as smoothly as possible at what is normally a very stressful time for people.
Having selected the best mortgage for you, we will ensure that we diarise the 'critical review dates', e.g. the end of the initial interest rate period, end of redemption penalty period. We can then contact you to review your current mortgage and your requirements, to ensure you still have a competitive interest rate and are not paying too much.
What is re-mortgaging and why would you do this?
Re-mortgaging is switching your mortgage from one provider to another. Usually you would do this to cut your monthly repayments, pay off debts or reduce the term of your mortgage. The main reasons you would move your mortgage to another provider are:
- To get a new cheaper mortgage at a lower rate. This will reduce your monthly repayments and you will have some extra cash - this could be used to make improvements to your home, or to pay off other debts
- To release some of your home’s value. It enables you to spend this now, rather than having to sell your home and move out to access it’s worth
- To extend the term of your mortgage. If you pay it off over a longer period, the monthly repayments will be lower. (Though the amount of interest you pay will increase
- To reduce the term of your mortgage. If you find yourself with more money (after a pay rise for instance), you could increase your monthly payments – meaning that you will pay less interest overall and be mortgage-free faster
What can we do?
Here at MMP we can take the hassle out of remortgaging. We act on your behalf, taking into account all your personal circumstances and finding the right solution. We shop around all the different providers and will find the best rate for you. All the paperwork will be filled in and dealt with by us, ensuring that your new mortgage is set up without any inconvenience to you.
Buy to Let advice
Buy to Let is the process of purchasing a house with the sole intention of renting it out.
When looking to purchase a Buy-to-Let property most people will look for a buy-to-let mortgage. This is a mortgage arrangement in which an investor borrows money to purchase property in the private rented sector in order to let it out to tenants.
The lenders will work out how much they are willing to lend the individual through a number of calculations (different to those used for standard mortgages). They usually have a slightly higher interest rate.
Benefits and Risks
As with all property rental, the benefits for a buy-to-let landlord can include a stable income from rental payments, as well as an accumulation of wealth if house prices go up over time.
Rising house prices in the UK have made buy-to-let a popular way to invest. The main risk involves leveraged speculation where the landlord takes a loan to buy the property, with the expectation that the house can be sold later for a higher price, or that rental income will meet or exceed the cost of the loan.
If the landlord cannot meet the conditions of their mortgage repayments then the bank will seek to take possession of the property and sell it to gain the loaned money.
Tips when looking to Buy to Let
- Research the market - You will need to put a lot of research into the market before you think about entering it. You have to know the benefits and the drawbacks of this type of investment.
- Choose a promising area - Promising does not mean most expensive or cheapest. Promising means a place where people would like to live and this can be for a variety of reasons, for instance in a University city to rent out to students.
- Do the maths - Before you think about properties sit down with a pen and paper and write down the cost of houses you are looking at and the rent you are likely to get for them.
- Shop around to get the best mortgage deal - This will help you with keeping the rent down, enabling you to keep rent at a competitive rate and give you a better profit.
- Consider your target tenants - Think about how the property should look for your tenant. Does it have the right features for the type of tenant you want?
- Consider looking farther away or improving a property - Improving a cheap property is a great way to boost your profits when renting, also don't be afraid to look further away from where you are currently living - aim for areas with good commuting links to increase your appeal.
- Don't be over ambitious with rental yield - Calculate the correct levels you need to make a steady profit but don't go overboard as you risk pushing away potential tenants.
- Don't be afraid to haggle – Buy-to-let investors have the same advantage as first time buyers when looking for a discount, see if you can negotiate down the price of the property.
- Know the pitfalls – Make sure you are aware of the possible negative drawbacks of this and what could happen if housing prices fall. Remember, this is an investment, and as with all investments, there is a risk.
- Consider how hands on you want to be - When buying a property you have to decide if you are going to let it be run through an agent or if you are going to do it all yourself. Agents will charge you for their services, but they usually have good links to professionals should there be any issue with the property. However, a DIY approach could save you money and gives a more personal service to your tenants. Bear in mind that you will likely have to give up a lot of time to make repairs and other things if they are needed. An agent can take away the hassle.
First time buyer advice
Should you buy now?
With the government, estate agents and new home builders all trying to persuade you to buy now, it is important not to be pressured into buying without having a clear picture of what price range you can afford. There are a few different factors that come into checking if you can afford a property such as:
- Is your deposit big enough? In the current financial climate it is almost a necessity for you to be able to put at least 10% of the house price in order to try and keep the repayments within reach.
- Do you have additional financial help? A larger portion of first time buyers than ever are now getting help off of their parents or other relatives when looking to purchase their first home. These added contributions to the deposit help to lower the monthly repayments.
- Have you considered the additional costs of the purchase? As well as the deposit there are also a few other fees that you will have to consider, such as stamp duty, legal and removal costs, survey and mortgage arrangement fees, as well as buildings insurance. Make sure you know all this to get a better idea of the true price.
Don't think you can afford to get on the property ladder?
There are many people who think that they will be unable to afford a house with their current wage, but there are also a few solutions that may enable them to get on the property ladder:
- Homeownership Schemes - In England, first-time buyers may be able to take advantage of schemes to help with home purchases. These schemes offer either an equity loan towards the house’s purchase price, with no fees for five years; or shared ownership, where you buy a share of the home and you pay rent on the remaining share. These schemes are usually run by Home Buy agents. Home Buy schemes are open to households which earn £60,000 a year or less.
- New Homes Incentive - Affordable 'starter' homes and first time buyer incentives are nothing new, but due to the current economic climate, developers are upping their game significantly. They are currently offering everything from help with the deposit and mortgage to rent now/buy later schemes; as well as potentially vouchers for food!
- Buying at Auction - Buying a home from auction can provide you with a chance to pick up a bargain. However, it is often a very difficult task and can sometimes leave you worse than you started. If you can, take advice from someone who knows how the auction system works and make sure you do your homework before going to the auction - ensuring you understand what properties you will be looking at and the buying process itself as it is completely different to the normal buying system
What will we do?
We will help you to figure out what is best for you personally. We can work with you, assessing your full financial situation, enabling you to get a clear picture of how much you can afford at the moment and how much you can put down as a deposit.
We have had extensive experience in securing mortgages for our clients and we will be able to help you to do so too.
Why would you move home?
There are a number of different reasons that a person would want to move house and it can be a stressful time. We are here to try and help you to understand all of the different pitfalls when it comes to moving home.
Moving home can be exciting, but is sometimes also stressful. Even if you've bought a house before, it's useful to refresh your memory about the steps involved - from finding a new property to sorting out the money and legal side of things.
- Work out what you can afford – it sounds so simple but make sure that you know how much you can lend, how much you can afford on the repayments, as well as the up-front costs of moving
- Selling and buying - make sure that you know the value of your property and you have a realistic price. When buying, make sure that the property is right for you as this is obviously a big commitment
- Putting in/accepting an offer - remember that nothing is certain until the contract is signed people can pull out last minute or your bid could be beaten by another person
- Applying for a mortgage - know what type of mortgage you would want and make sure you have all of the necessary paperwork ready
- Make sure you are protected – do you have buildings and contents insurance? Have you thought about any other protection in case you lose your job or are injured?
- Legal work - make sure you understand what legal fees you will need to pay
- Move in - once you have moved in then ensure you keep up with the repayments and enjoy your new home
What can we do?
We at MMP are specialists when it comes to mortgages and insurance, so we can help you through this process of moving into your new home. We also have contact with Estate Agents, so we can help you with every step from estate agents to solicitors.