When you remortgage, you take out a new loan with either your existing lender or another lender. According to the Council of Mortgage Lenders (CML), there were 34,700 loans for remortgage in December 2016, worth a total £5.8bn – that’s an increase of 13% in volume and 14% in value – while Paragon reported they now account for 39% of all mortgages handled by advisers.
Remortgaging could help you free up money for something you really want, help you pay your mortgage off quicker by moving to a lower rate, or help you better manage your monthly household outgoings. TSB found that homeowners could save an average of £96 a month by remortgaging to a lower fixed rate deal.
You’ve sealed the deal, inked the contract and are about to move into your new home at last. But before you take a breather, there’s still plenty to do – some of it is the fun part (furnishings) and some of it is necessary administration tasks. Each of those can be done in a finance-friendly way though.
Here are our top tips for moving in to your new home, and how you could make the most of your finances.
Buying your first home can seem at times like climbing a particularly steep hill - daunting, confusing and with several pitfalls along the way. Prices are still rising, with the average UK first-time buyer home now costing £184,973, 7% up on that of a year ago1.
And finding the money for a deposit without help from the Bank Of Mum And Dad can be a real challenge – the typical first-time buyer deposit is now £33,222- that’s 133% of an average salary1. The average first-time buyer borrowed 3.49 times their income, and the average first-time buyer loan was an estimated £136,0001.
But with a few simple steps to prepare yourself financially, and make lenders see you in a positive light, you could approach buying your first home with a lot more confidence.
The mortgage affordability rules introduced in April 2014 take into account not only how much you are earning, but how much you are spending, and whether you actually have the money to make your monthly mortgage repayment. It could even lead to longer-term mortgages, potentially taking people past 65.
The consequence for many people though is that credit refusal can often lead to more attempts to get credit – and making multiple applications in a short space of time could have a serious impact on your chances of getting credit in the future.
There are a number of reasons you might be turned down – and finding out what they are could get you back on track.
Applying for a mortgage is likely to be one of the biggest financial decisions you ever make. Taking the time to prepare and really understanding what a lender is looking for – before you make your application – could not only affect you getting approved, but could also save you a lot of money in the long term.
This guide will give you some simple steps to follow to ensure you are in the best possible position to have the mortgage you can afford approved – and at the best rate.
The mortgage lending process Usually a lender (the bank or building society) will consider the following when deciding whether to approve your mortgage application:
The information in your application form, including your salary and employment status
The Financial Ombudsman Service ruled in the couple’s favour and ordered the bank to pay them £500 in compensation, saying that the bank had relied on “untested assumptions, stereotypes or generalisations in respect of age”.
Should we be given the chance to keep up mortgage payments past the age of 65?
It’s arguable that being 65 today - in terms of health, lifestyle, fitness and expectations – is not the same as being 65 twenty, certainly forty years ago. And 65 being the default retirement age has been phased out, and people can work as long as they choose to – employers are no longer allowed to discriminate against workers choosing to work beyond 65. Continue reading →
Could your credit history prevent you from getting a mortgage? Experian research has found that more than a quarter of people in the UK looking to buy their first home before 2016 – around 1.81 million people – have missed credit repayments, defaulted accounts and CCJs currently listed on their credit report*. And all of these could prevent them from securing a mortgage.
Managing credit accounts such as credit cards, mobile phone contracts and even some utility services can be important in order to build and maintain a good credit rating.
Visit the London Home Show – 26 September, Queen Elizabeth II Conference Centre, Westminster, 10am-5pm
There are many challenges faced by first time buyers trying to get on the housing ladder, particularly for those without the help of the Bank of Mum and Dad.
First time buyers should not lose hope, however, as there are now a wide range of affordable housing schemes to help people get onto the housing ladder and progress to a larger property. These include:
Buying a home with your partner or friends can be a much needed boost to get on the property ladder – helping to raise a bigger deposit and making your dream that extra bit more affordable.
Checking yourExperian Credit Reportcan also help you see if and how you are financially linked. It can also help you understand if you need a little work to tidy up your credit history before a joint mortgage application is made. Here are some key tips we’ve put together to help you, if that’s what you’re about to do.