Some clients come to us for specialist mortgage advice in Cambridge when their credit score is lower than the acceptable amount or they have missed payments. Adverse credit is a frequent occurrence and this is something that our mortgage advisors in Cambridge might be able to help with.
A potential factor that could effect you when obtaining a mortgage is if you have either missed a monthly mortgage payment or any smaller payments such as your mobile phone contract. This can happen through an attachment on your credit score that states your missed payments. From this, the lender could see that you are a risk.
However, missing monthly payments doesn’t always mean you can’t get a mortgage, but there is the potential risk that the high street bank may turn you down. This is especially the case if you only have a small deposit for the property you are looking at, as it may not be enough to convince a lender to lend to you. To prevent this from happening, you may need specialist help.
The lenders will want to know when the default was registered against you. The likelihood of receiving the necessary help depends on how far away you are from that specific date. In certain circumstances, like ill health, separation or redundancy, the advisor may be able to help even if it is a recent occurrence.
We have provided further information below that answer any common mortgage scenarios regarding bad credit mortgages in Cambridge.
Your mortgage advisor in Cambridge will want you to provide an up-to-date copy of your credit report and you can obtain one of these usually free of charge (check with the providers T&Cs). It is advised you have your credit report before applying for a mortgage and even more so if you have had any doubts about your credit history, as it gives your advisor an exact snapshot of your financial situation.
This depends on your circumstances. When it comes to the impact of bad credit, some customers may become a little confused. Despite having bad credit, with a sufficient income & enough deposit, it may be possible to obtain a mortgage.
Reassuring the lender that you can pay back your mortgages without the possibility of any late payments happening is key, as the lender needs to proceed with confidence. If the worst happens, your home may get repossessed, which the lender would want to avoid. There are many routes to take when people who have bad credit are looking to get a mortgage, even if these routes may have higher rates of interest. The most appropriate next step when seeking a potential mortgage is to get in touch with a mortgage advisor in Cambridge (like ourselves) to help.
In some cases, you may find yourself struggling financially and are unable to keep up with mortgage payments you didn’t have trouble paying in the past. This isn’t an ideal place to be and even if this was a momentary lapse, it would still be on record as a missed payment.
Credit issues may occur during this period and this could become an issue for when it comes to getting a remortgage at the end of your term or a new mortgage after moving home in Cambridge. As mentioned before, this is based on risk. Can the lender trust you not to find yourself in that situation again?
Our mortgage advisors in Cambridge have a lot of experience when it comes to customers having bad credit, particularly when they have previously had or currently have a mortgage.
Other adverse problems customer could potentially run into regarding their credit are;
Even though these situations aren’t the best circumstances to find yourself in, it’s not the end of the road. The process may involve many challenges which involve you paying a higher rate of interest. There are many specialist lenders out there who may accept you depending on the nature of your circumstance.
We highly recommend that you work on improving your credit score. Our How to Improve Your Credit Score article is a helpful, in-depth mortgage guide that will hopefully put you on the right path to obtain a mortgage.
Good news for military personnel, according to Army Families Federation Defence Secretary, Ben Wallace. The Help to Buy Scheme, that helps military personnel get onto the property ladder, has been announced as being extended.
The £200 million scheme was introduced in 2014 to offer a boost to anyone from the armed forces who needed help buying a home. Originally intended to end in December 2019, the government extended the scheme until the end of 2022, as a thank you for their commitment to their service and dedication to the country.
This works by accessing a borrowed deposit that is summed up to half of your annual salary (a maximum of £25,000), without any interest involved, then the deposit can be used to purchase a first home or to move into a new home.
A benefit of the scheme is that you don’t need any current savings to get yourself on the property ladder. The money raised from the loan can partly be used to be put towards your deposit or other costs:
Another advantage that benefits forces personnel is that the majority of lenders will accept the loan towards the deposit for a new home. More relaxed than some other schemes, the Forces Help to Buy loan can be paid back over a period of 10 years, so you don’t have to feel as rushed.
Even if you were unsure that you would have a chance, if you are able to match the criteria (length served, service term left and medical categories), you are eligible to purchase your home using the Armed Forces Help to Buy Scheme.
Click here to read through further details from the government site.
From the minute you call up until the completion and beyond, our knowledgeable mortgage advice team in Cambridge has your back. They will make sure you are taken care of and are determined to find you the best option for your circumstances.
For your fast and friendly customer experience, get in touch today and see how we might be able help you with seeking your dream home.
Please note, the Forces Help to Buy is not the same as the standard UK Help to Buy scheme.
As a whole, the mortgage process can be very surprising and have its fair share of both ups and downs. Some applicants may receive a fast and simple process whereas others may find it more difficult to find the road to mortgage completion.
Either way, once you secure your first property, you will come to a point where you can choose one of two routes to take. Your first option will be to continue climbing the property ladder and move into a new home; your other option, if you feel like you’ve already found your dream home, is to remortgage for home improvements such as an extension or conversion. In this article, we are going to focus on remortgaging and the different reasons why people choose to remortgage.
A remortgage is simply taking out a new mortgage to pay off a pre-existing mortgage. There are lots of different things that you can do at the point of remortgage, it’s completely up to you what you choose.
Generally speaking, you will remortgage every time you come to the end of your fixed mortgage term. If you choose not to remortgage, it’s likely that you’ll fall straight onto your lender’s standard variable rate of interest, which will probably be more costly than your current rate.
Your initial mortgage deal will likely last you around 2-5 years. As mentioned above, if you don’t remortgage you will end up on your lender’s SVR. Sometimes, their rate can be higher than tracker mortgages (track the Bank of England’s base rate), so this could end up costing you a lot more than your usual mortgage payments.
If your mortgage term ends, you can also fall onto a tracker mortgage. A tracker mortgage interest rate will fluctuate depending on how the economy is performing. For example, during the coronavirus pandemic, in March 2020 the Bank of England’s interest rate was significantly lower than usual as the economy wasn’t performing the best. Slowly, as the economy started to recover, the interest rate rose as the months passed.
This is why people often remortgage to find a better rate. Homeowners want to find a better interest rate so that they don’t have to pay as much for their mortgage payments every month yet they are still paying off their mortgage.
Rather than Moving Home in Cambridge, you could always freshen up your existing home to create more space through an extension or conversion. You can also remortgage to fund home improvements such as a new kitchen or living room, it’s completely up to you.
This works like so; when you take out a new mortgage product, the costs for home improvements will be incorporated into your mortgage. This means that your monthly payments will increase and so can your mortgage term.
If you already love the house that you live in, it could save you a lot of money if you were to remortgage over move home. It may be much easier and more beneficial for you in the long run to remortgage for home improvements rather than move home.
As a Mortgage Broker in Cambridge, we’ve seen many applicants that have realised further down the line that they want a different product, however, they are mid-way through their term. They may just want a more flexible product that allows them to reduce their term. Although this could mean that their payments increase, their mortgage term will decrease.
A flexible mortgage could allow you overpay your mortgage payments to pay it off quicker. Usually, people choose to remortgage for this reason if they’ve perhaps had a pay increase or been given a large lump sum of money (e.g. through a redundancy).
Some people may even want to keep their monthly payments the same and remain on their current base rate. When this is the case, you are sometimes able to remortgage to extend your term.
As a homeowner, you are bound to have some equity built up inside of your home. This equity can be turned into cash, and that’s why people sometimes remortgage to release equity.
The amount of equity that’s within your home can be calculated by taking away how much is left on the mortgage from the property’s value. The amount that is remaining can be taken out and turned into cash. You can choose what you spend this money on. It could be for home improvements, a deposit for another property (buy to let landlords) or even a holiday/ to pay off a car loan – you choose!
You can also release equity in the form of a lifetime mortgage. This is often targeted at older homeowners who want extra funding for their living circumstances.
Firstly, debt consolidation is a specialist subject, so we would recommend that you speak with a Mortgage Advisor in Cambridge before rushing into anything.
Consolidating debts consists of incorporating unsecured debt into your mortgage. Doing so will increase your mortgage payments and sometimes your mortgage term too.
All lenders have a different viewpoint on consolidating debts into a mortgage, some may allow it and some may not. Lenders often disallow it as you are putting unsecured debt into a secured asset. This means that if for any reason you fall into arrears after failing to meet your mortgage payments and your property is repossessed, they will lose out on money as there is all of your debt now secured within the property.
It’s a very complex subject that you should get specialist help for. For debt consolidation and Remortgage Advice in Cambridge, you should get in touch with our excellent mortgage team at Cambridgemoneyman.
Having now read about the reasons that people remortgage and how they work, do you think that you could benefit from remortgaging? Whether it’s to access a better rate, for home improvements, for term flexibility, to release equity, to consolidate your debts into your mortgage or for something completely different, there is usually always a situation where a homeowner will remortgage.
If you want to speak with a Remortgage Advisor in Cambridge about remortgaging, feel free to get in touch with our team. We will be more than happy to try and help you accomplish your remortgage wishes.
Here you’ll find out the basics that you need to know about agreements in principle, including the pros and cons of getting one. For more information, get in touch and speak with one of our expert Mortgage Advisors in Cambridge today. An Agreement in Principle (also known as an AIP or Decision in Principle) is where you pass a Lender credit score to qualify for a mortgage.
By obtaining an Agreement in Principle, you prove that you are ready to support any offers you make as a First-Time Buyer in Cambridge. It may also help negotiate a lower price if you have one of these, as it shows the seller you are serious and have the means to continue with the process.
The more commonly seen methods of credit scoring are via soft searches rather than a hard search. These may still affect your credit score, though a hard search will usually be more likely to do this than a soft search.
Reasons come down to a hard credit search that can leave a credit footprint, whereas a soft search does not. Regardless, you can rest assured that whichever is used by the Lender is done with the best intentions.
Having your credit checked via a hard search every so often should not make too much difference. It becomes an issue if you take too many of these within a small amount of time. On the flip side, if you know you have a good credit score and the best path to take with a lender, this should not be a problem.
Whilst the prospect of this would be excellent, there are no guarantees that having an Agreement in Principle will allow you to get a mortgage. The Lender will still require seeing all your documents, and only then will an Underwriter make the very final decision.
Often we find that customers contact us after they got declined at the application stage due to missing some small print in their Agreement in Principle. You will need to provide ID to prove that your identity, payslips to prove your income and bank statements to prove you are smart with money before a lender offers your case.
Though you can make an offer without an Agreement in Principle, we would not advise doing so. Any credible Estate Agent will want you to prove you can progress onward.
It is possible to obtain an Agreement in Principle within 24 hours of getting in touch with an experienced mortgage advisor in Cambridge.
Typically, an Agreement in Principle will expire after 30-90 days. The good news is that this doesn’t mean you should apply for the first house you find. If your Agreement in Principle expires, it’s not difficult to obtain another ahead of making an offer.
Finding a mortgage only to be declined a mortgage can cause understandable disappointment. With this in mind, we recommend getting an Agreement in Principle as early as possible.
If you are a First-Time Buyer in Cambridge or are looking at Moving Home, you will know that several forms of mortgages are available. Some of them are more common than others, and some may even be difficult to find. We have assembled a list of some of the most common forms of mortgages. You will also find one of our MoneymanTV episodes useful for learning more about these.
A fixed-rate mortgage means that for a specified time, the mortgage rates will remain the same. You should decide your period, usually 2, 3, or 5 years or more, for your payments. You know your mortgage balance will typically be the largest outstanding one, regardless of inflation, interest rates, or the economy.
Your interest-rate shall track the base rate of the Bank of England by using a tracker mortgage. In other words, the lender does not fix the rate itself. You pay a sum above the base rate of the Bank of England. An example of this is where the basic rate is 1%, and you are tracking at 1% more than the basic rate, you pay 2%.
If you carry out a repayment mortgage, you pay capital and interest together every month. So long as you carry the full term of the interest loan, you will pay the mortgage debt at the end, and the property shall be yours. This is the risk-free way of paying the lender back the money.
The interest you are paying in the early years, and particularly with a period of 25, 30, or 35 years, your balance would decrease very slowly. In the last 10 years or so, this scenario changes, where your payments pay more capital than interest and your balance falls even faster.
While some transactions allow mortgages on an interest-only basis, residential property is even more difficult to obtain on an interest-only basis. Lenders are also less likely to sell a product that is interest-only. However, it may be an alternative under some conditions.
This involves reducing the amount of money you pay out as you’re older or have other savings. When it comes to offering these items, lenders are very strict now, and the valuation loan is much smaller than before.
You can build a savings account alongside your mortgage account for an offset mortgage. How this works, is you pay interest on the difference, for example, you pay £80,000 for the balance of £100,000, and £20,000 is deposited in your bank account. This can be a very successful way to manage your capital.
Are you approaching the end of your deal? Do you need to borrow some extra money for capital or home improvements? If so, then now could be the best time to remortgage.
As a Mortgage Broker in Cambridge, it’s not unusual for us to see customers forgetting to renew their mortgage deal. When this happens, people end up slipping onto their lenders’ variable rate which is usually higher than their current rate. This is why we always advise that you keep on top of your mortgage and make sure that you know when your deal is coming towards its end, especially if you have a short-term deal.
If you know that you’re coming towards the end of your mortgage term, it’s time to take the next step. Remortgaging can be a complicated process, so don’t hesitate to contact your Remortgage Advisor in Cambridge.
Over our 20 years of working within the mortgage industry, we have learnt that the best way to find a better remortgage deal is to shop around first. Before committing to the same lender, take a look at the other deals out there as there are hundreds if not thousands. Although not every deal may match your criteria, some certainly will and that’s why it’s important to shop around first before rushing into accepting the first deal that is offered to you.
We say this with your best interests at heart; more often than not, your lender will not reward you for your loyalty and are probably offering better deals to First Time Buyers.
If you are wanting to find a competitive rate and are interested in switching products, it could be your best option to approach a Mortgage Broker in Cambridge. They will work by your side and help secure you a deal that matches your personal and financial situation. For example, here at Cambridgemoneyman, we will always aim for a deal that is better than your current one.
Speaking to a Mortgage Advisor in Cambridge should be your first option when you don’t know where to look for competitive deals. Another benefit to using a Mortgage Broker in Cambridge is that they can have their own panel of lenders, some of which you can’t access by yourself.
Looking to upgrade your home? Thinking of finally treating yourself to a fancy new kitchen or a spacious home office? Well, did you know that this can all be done through remortgaging?
Whether you want to invest in your property or add more living space to make more memories in your dream home, remortgaging for home improvements could be the right option for you; there is nothing wrong with giving your home a makeover. You can increase your mortgage to pay for cosmetic alterations as well as structural work.
As a Mortgage Broker in Cambridge, we usually see that homeowners want to remortgage for home improvements because they have plans to start/already have started a family. However, if this isn’t your situation, we can still offer a helping hand and try and secure a great remortgage deal to switch onto. Whatever your situation is, we are still more than happy to help.
If you need to borrow a significant amount of money, your lender will reserve the right to ask you for estimates for the works you intend to have carried out. You don’t necessarily have to use the contractor that provided the estimate to do the actual works.
You can also raise capital on your property when you remortgage for almost any legal reason. For example, this could be for large consumer purchases, gifts to help family members, to purchase a Buy to Let property or for debt consolidation.
It is important that you know that you will still be paying interest on a remortgage for a long time after you take one out so you need to make sure that you are borrowing for the right reasons and that you will be able to meet monthly payments during the whole mortgage term.
Adding unsecured debt to your mortgage may result in you paying back more interest overall. This is down to a mortgage term usually being much longer than the length or a personal loan. However, this isn’t the case all of the time.
You must consider that you are taking unsecured debt and securing on your home. This won’t sit easily with everyone as you are under the risk of repossession if you cannot afford your mortgage payments down the line.
If you have 0% credit cards, you will need to know that the interest rates that apply to the debts that you are considering rolling onto your mortgage will start attracting interest too.
Often, consolidating debts into your mortgage leads to a reduction in your monthly outgoings. Some customers end up reducing their payments by hundreds of pounds.
To summarise, we highly recommend that you take all of your options into consideration before deciding on anything. Whether you are thinking of switching deals for a better deal, home improvements, capital raising or debt consolidation, you should know that your expert Mortgage Broker in Cambridge is here to help. We have over 20 years of remortgage experience and often know exactly how to help; there is rarely a situation that we haven’t come across before.
To speak to a professional Remortgage Advisor in Cambridge and find out which option could be the best for you, feel free to get in touch. We can’t wait to help you get the ball rolling with your remortgage journey.