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Mortgages

Mortgages

How porting a mortgage works

15/03/2017

Porting a mortgage refers to the transfer of a pre-existing mortgage product to a new property. The transfer is arranged by the buyer and his mortgage lender. Mortgages are transferred for many reasons. A buyer can transfer a mortgage because he wants a bigger house or when he needs to relocate to a different place. Not every buyer can qualify for this service. Lenders have different criteria for allowing porting a mortgage. Porting mortgages is a rather new service. Some lenders have not yet embraced these mortgage transfer services. It is important to ask your lender if they can allow you to port mortgage before moving into a new property.

Remortgaging or porting a mortgage

The success of mortgage transfer depends on the kind of agreement that a buyer and his lender has. A lender may charge higher interest on transferred mortgages. If the interest rates are not appealing to you, then you may remortgage rather than port the existing mortgage. The advantage of porting rather than remortgaging is that a buyer gets to work with a lender he is used to. This lender has gone through your credit ratings and has seen how reliable you are. He will easily consider your desire to port. It is always important to be in a good relationship with a lender. You never know when you will want the lender to help you port your mortgage.

Prerequisites of porting a mortgage

When you are porting your mortgage, the existing mortgage will have to be paid in full. Moreover, you will have to reapply for porting a mortgage. Full settlement of existing mortgage usually happens before the scheduled time when the mortgage was to be repaid. So there can be an early repayment charge and exit fee. Part of the settlement price goes to mortgage repayment. The balance can be used by the buyer to arrange for a new mortgage.

Fees related with porting a mortgage

Porting of mortgage attracts various fees. When it comes to fees, mortgage lenders treat ported mortgages more or less like any other mortgage. The same fees that applied to the first mortgage will apply to the ported mortgage. The very first fee that a buyer will require you to pay is the early repayment fee. Early repayment fees are charged on mortgages that are repaid before an introductory period. The fees cater for the losses that your lender goes through when they close the deal with you earlier than they expected. These charges are usually 1% to 5% of the outstanding debt. Almost all buyers who want to port their mortgages have to pay outstanding fees because they have to close their existing mortgages before applying for new ones.

Other considerations

The home that you are porting your mortgage into can be more expensive or less expensive than your existing home. These two situations are treated differently by your lender. It is easier port a mortgage to properties that are less expensive than the current one. Some mortgage lenders will not allow you to transfer the mortgage to properties that are more expensive than the one you are living in. The decision to allow a buyer to port or not to port depends on whether the buyer has been repaying his mortgage on time, as well as the credit rating of the buyer. All these are factors that you must put into consideration before you port a mortgage.

How to get a self employed mortgage

09/03/2017

The primary qualification for a mortgage is the ability to pay back. People who are employed in steady jobs have pay slips that help prove that they can repay their mortgages. Things are a bit different for the self-employed. Self-employed people have fluctuating incomes. Mortgage lenders find it hard to lend money to people who do not have steady incomes. They fear that these people cannot repay the loans. This does not mean that there is no self employed mortgage for people without incomes. It only means that these mortgages are harder to get.

The self-employed mortgage process

Self employed mortgages were easier to get before the credit crunch of 2007. People doing private business could easily walk into banks and come out with loans. The mortgages were actually referred to as self-cert mortgages. Their processing was fast-tracked without the need to prove incomes. The self cert mortgages were aimed towards freelancers, businessmen, contractors and people with multiple sources of income. Unfortunately, some people took advantage of the fast tracking and borrowed money they could not repay. About the same time, there was economic depression. These forced mortgage lenders to establish credit crunch. Since then, borrowers are now forced to go an extra mile in proving their creditworthiness.

Self employed mortgage is not really a word that is officially recognised by mortgage lenders. The only difference between this type of mortgage from other mortgages is that the borrower has a lot to do to prove that he can repay the mortgage. Lenders have a checklist that they tick when assessing a self employed mortgage applicant. These are the things that you need to know before applying for a mortgage because they determine whether your application will be accepted or rejected.

Requirements for Self employed mortgage

The first thing that lenders ask borrowers is their financial accounts. It is expected that any self-employed person should keep a record of his incomes and expenditures. This is the basis for the request of the borrower’s financial record. The account will enable the lender to determine if you can repay. The financial history should go back a few years. Most lenders ask for a two year’s account. The account must also be up to date. You must ensure that the account you provide is drawn by a certified or chartered accountant. A lender may reject an account that is drawn by either the borrower himself or any other unqualified person. Rather than your business financial account, you may also use your tax return to get a self-employed mortgage.

You must also ensure that your credit history is perfect. Lenders can be more exacting with credit histories of self employed people than they are with salaried people. The credit history of a self employed person shows how frugal he is with his money. A self-employed individual with a good credit history has more chances of getting a mortgage than a salaried person with similar credit history. Paying your credits on time is important. In case you have a problem with your credit company, make sure that you sort the problem out before applying for a mortgage.

How does help to buy work

08/03/2017

Help to buy is a government lending scheme that enables new home buyers to get mortgages easily by assisting them in raising a deposit for a mortgage. Traditionally, mortgage lenders usually require borrowers to make a deposit or have security when applying for a mortgage. The deposit can be a percentage of the price of the house that the lender intends to pay. The security is a guarantee that the lender will not lose his money when he gives out a mortgage. The more deposit you make, the better your mortgage deal will be. The bank can offer you lower interest rates and larger mortgages when you pay more deposit. The big question still remains how does help to buy work. Basically, help to buy helps you raise larger mortgages so that you can enjoy a good deal from a lender.

Help to Buy Scheme arrangements before 2017

There are two slightly different arrangements within the help to buy scheme. The first one is the Mortgage guarantee scheme. This scheme was instituted on October 8th, 2013 and was expected to run until December 31st, 2016. The scheme should have expired at the beginning of 2017. The other arrangement is the Equity Loan scheme. It was instituted in April 1st, 2013 and is open until 2020. It is the arrangement that anyone who intends to get into “Help to Buy” scheme from 2017 should join. There is no significant difference between the two arrangements.

Requirement for Help to Buy

The first thing you need to know is the criteria for admission into help to buy scheme. Not everyone is eligible to get help with the scheme. This scheme is only for new home buyers. The buyer must use the property has his sole residence. He cannot rent out this property. The now expired “mortgage guarantee scheme” could be used to buy both new build and pre-existing houses. Equity Loan schemes apply to only new build homes. This means that the scheme is getting tighter in its requirements. The borrower must also prove that he can repay his mortgage. His credit rating must be good. He must also have a steady job or a reliable source of income.

Equity Loan Scheme

In equity loan scheme, a buyer is expected to raise a deposit of only 5% of the property value. The government will then give the buyer an extra deposit of up to 20%. With a total deposit of 25%, you will find it easier to get a good mortgage deal. Ordinarily, you can get a mortgage with your 5%. However, a lender may be stricter on an applicant with only 5% deposit. The extra deposit that you get from the government is a loan that must also be repaid. The loan is interest-free for the first five years. On the sixth year, you will have to pay an interest of 1.75% of the loan. The interest rate will increase by 1% every year until the loan is fully repaid. You may also have to pay for inflation.

Borrowers can repay the equity loan at any time during their stay in the property. You may pay 10% or 20% of the loan provided that the loan is at least 10% of the value of your property. If you leave your property without paying the loan, the government will sell the property and reclaim its money.

How long does it take to remortgage a home

22/02/2017

Remortgaging allows you to recover the money you have been repaying your original mortgage lender by paying off the balance of his mortgage and pocketing the rest of the money. You pay off this balance from the money you get from remortgaging. Because the amount of money you get from remortgaging depends on the value of your house, you will be able to keep part of these funds after repaying the balance the original mortgage. There are many reasons why you may want to remortgage. The big question is how long does it take to remortgage. The more urgently you need the money, the shorter you will want the remortgaging to take.

Be actively involved

The first thing that you need to be clear about is why you need to remortgage in the first place. Your reason for remortgaging will push you into processing the mortgage faster. Most delays in processing remortgages are human. When you do not feel the urgency to process the mortgage faster, you will slacken, and the remortgage will take longer. You must actively follow up everyone involved in remortgaging your home if you need the money sooner. Consider two people, one who want the money to build an annexe and the other who wants to pay school fees. The one who needs the money for building an annexe is not confronted with an emergency. His needs are not as time bound as the one who wants to pay for school fees. He will let the mortgage processing process takes its own course.

Planning Ahead

Remortgaging will take a shorter time if you intend well before starting the process. There are many steps involved in remortgaging. Some of these steps can take quite long to accomplish. They may take even longer if you are not adequately prepared. You must have all documents ready before you start remortgaging. Make sure that everything the parties involved in remortgaging want is ready when they need it. You can only do this by anticipating what will be necessary. You may find it hard to know all documents required from you during remortgaging. If you are doing it for the first time, you can ask a solicitor about the things you need in getting a remortgage.

The Remortgaging process

Remortgaging involves the same step as mortgaging except now you have two loans to process. One of the loans will close, and the other starts. Your current lender will expect you to pay off the balance of his mortgage plus some fees. Some of the fees you will pay to include closure charges, early repayment charge and missed payment fees. Closure or exit fees are paid for when the mortgage terminates. It can be replaced by early repayment charge if the mortgage ends before the prearranged time. Most people who remortgage find themselves paying this fee rather than the closer fee.

The new lender and other people you recruit to help you with remortgaging may affect how long you remortgage. You will need a solicitor during the whole process. Make sure that the solicitor is highly efficient. He must be fully engaged in this duty. You can get such a solicitor by referral or from one of the many solicitor review websites. 

Getting a loan through equity release schemes

20/02/2017

An equity release is when a homeowner uses all or part of his house as a loan security. The owner is given money in return for a share in home ownership. The lender does not occupy the house. He only claims a monetary share of the house which he will reclaim when the house is sold. The house can only be sold when its owner dies or moves to a lifetime home care. Till then, the homeowner is the sole occupant of the house.

Not everyone can qualify for home release schemes. A homeowner must be over 55 years to be eligible for the scheme. He must have little or no mortgage on the property. The loan will be used to pay any balances on mortgages. This way, the lender will not have to pay off pre-existing mortgages upon the sale of the house. Loans given are usually at least £15000. Anything lower than that amount cannot be released. The value of the property also determines your eligibility for equity release loan. Only properties worth more than £75000 are admitted into the scheme.

Types of Equity release schemes

There are two main types of equity release schemes. These two are lifetime mortgage and home reversal mortgage.

Lifetime mortgage scheme

Lifetime mortgages allow you to retain total ownership of your home. You do not have to pay any rent. This is contrary to shared ownership or the home reversal type of equity release scheme. An applicant for a lifetime mortgage must be at least 55 years old. If he is living with a partner, the partner must also be 55 years old.

Different lenders have various ways of handling lifetime mortgages. A lender may allow you to enter into no negative equity guarantee plan. This program ensures you that the loan you take plus accumulated interest will not exceed the value of your property. The advantage is this scheme is that you will be able to pay the mortgage in full from the money made from the sale of the house. You will not be required to pay the balance of the loan from your own pocket. No negative equity prevents the horrors of endowment mortgages that many people in the UK are now putting up with.

Home reversal scheme

The other type of equity release scheme is the home reversal. An individual who enters into the home reversal plan immediately loses ownership of all or part of his house. This share of the house that the original owner loses goes to the lender. The original owner must, therefore, enter into a lease with the lender where he may live rent-free or pay or rent token to the lender if he has to live on the property. If he moves out or dies, the house is then sold and the money used to repay the loan. To qualify for the home reversal plan, you and your partner must be at least 65 years old. The loan issued is equal to or less than the current market value of your property.

Mortgage valuation fee and other costs of Mortgaging

15/02/2017

Mortgages are loans that are used to buy properties. Paid for in premiums through an extended period of time, a borrower has more to pay for than just the mortgage. Top of the list of expenses for securing mortgages is the mortgage valuation fee. This fee is for professionals who assess and evaluate a property that is to be mortgaged. Mortgage lenders must know the value of a property before issuing mortgages. The property is security for their loan. Repossession is a possibility if the borrower fails to repay his loan. A wrongly quoted price will mean that the lender will have to lose some money if the property needs selling.

Mortgage valuation fees are by no means the only costs associated with a mortgage application. There are many other charges. These fees pay for every service that the lender offers to the borrower. The fees start adding up from the time the borrower sends an application for a mortgage to the time that he fully repays the mortgage. The first fee that is charged even before valuation fee is the booking fee. A booking fee pays for services offered during processing of loan application forms of a borrower. The lender will have to get someone to go through the borrower’s application forms and shortlist the borrower for the mortgage.

The other fee is the arrangement fee. Once a lender is shortlisted and deemed fit for a mortgage, the lender must make arrangements on how the borrower will get the money. There are many documents he will fill. He will also ensure that there is enough money to send to the lender. All these services cost a borrower the arrangement fee. Related to the arrangement fee is the telegraphic fee. This is the cost of transferring an arranged mortgage to the borrower’s solicitor.

Mortgages are usually paid for in instalments over a very extended period of time. A 30-year mortgage can have as many as 360 monthly payments. A lender must account for each instalment that is paid as well as those that are not paid for. He will have to do this during the whole duration of mortgage repayment. The lender cannot maintain a borrower’s mortgage like this without asking for some service fee. The service charge, in this case, is the mortgage account fee. Mortgage account fees pay for the administration and management of a mortgage from the day it is issued until the time when payments are complete.

Other mortgage costs include missed payment fees, mortgage broker fees, higher lending charges, early repayment fees and closing or exit fees. Missed payment fees are charged on any unpaid instalments. Higher lending charges are levied when a borrower takes a mortgage that is more than the value of his property. It protects the lender from losses that could arise if he repossesses and sells the property. The exit fee is paid for the cost of terminating a mortgage at the end of a mortgage period. 

Facts about a fixed rate mortgage

07/02/2017

Fixed rate mortgages have constant instalments and interest rates. These do not change during the whole mortgage period. Other types of mortgages are adjustable mortgages and hybrid mortgages. Adjustable rate mortgages have interest rates and monthly instalments that change during a mortgage period. Hybrid mortgages start as fixed rate mortgage but later have their interest rates or instalments varied according to the agreement between the lender and the buyer. Fixed rate mortgages allow the buyer to plan his expenditure on mortgage ahead of time. However, they are so rigid that they do not take into account changes in inflation or variations in incomes of the lenders.

Fixed rate mortgages are usually paid for after every month. A thirty-year loan will be paid for twelve times in a year and have a total of 30 instalments. Before all payments are paid for in full, the owner will not claim absolute ownership of property. The property still remains a collateral for the lender that issued the loan. You may shorten the duration of payment to 10, 15, or 20 years. Remember that for every given principle, the shorter the duration of loan repayment, the larger each instalment will be. You should shorten the length only if you are confident that you will be able to afford the monthly repayments. Mortgage arrears can be a big problem for people who have to pay large monthly instalments.

You can also shorten the duration of your fixed mortgage repayment by paying biweekly rather than making monthly instalments. A 30 year fixed loan will have less than 30 instalments if paid biweekly. Because biweekly repayment method is a special kind of mortgage repayment system, it is treated differently by mortgage lenders. Lenders usually charge for biweekly loans. The loan also attracts registration fees that differ from one lender to the other. You must also pay debt charges every time you pay an instalment. All these fees are never as significant as to make the loan more expensive than the monthly repayment system. However, you must ensure that you are fully prepared for the charges. The biweekly loan, like monthly instalments, are usually paid for from the savings or checking accounts of the borrower.

Rates of fixed rate mortgages are determined before the loan is issued and remain constant until completion of repayment. This implies that the rates have are carefully assessed before being applied. Inflation and drastic changes in house prices can cause lenders significant financial losses if the rates are to not adequate. Mortgage lenders get their money from the savings of their account holders and from their own investments. They may also borrow the money from other financial institutions. The rate of borrowing from other banks is called the swap rate. All these determine the rate of the fixed mortgage. The Bank of England also plays a significant role in mortgage rate determination. The Bank of England strongly considers runaway house prices when determining mortgage rates. If low rates are causing a fall in house prices, then the bank will ask lenders to increase the rate. 

How to go ahead with financing modular homes

02/02/2017

Modular homes are homes that are built offsite and are physically fitted together on site of your choice. Often called as prefabricated home, their popularity is on the rise because they are cheaper, faster and customised. While they may not be built from ground up with foundation, they can be constructed to withstand high weather impacts.

In financial terms, they have similar rates of home loans, insurance premiums and taxes as site-built homes. And conveyancing of these home are performed similar to regularly built properties. As modular homes can be highly customised as per your need, there is much consideration you have to make. Financing your modular home is one of the first step in the process. These steps will help financing modular homes.

Prequalification Estimate

The first step is to calculate how much money you are going to spend on your modular home. These estimates are required to get approval from the bank for the loans. They will assess your calculations and let you how much they can lend you with the interest rates for the amount.

Comparing rates

As you are financing your home, it is recommended to check a few banks to see what their interest rates are like. You will need to search for a bank with interest rate you are comfortable with. The small difference in the rates can amount to huge sums of savings in mortgage payments.

Apply for Loan

After you have chosen the land where your home is going to be built and a particular modular home plan. You will need to apply for the loan with the bank of your choice. Several verification checks are done to check the cover for the fees like credit check, proposed contract of the modular home of your choice, recent loan statements and other details.

Approval

If the application process goes smoothly, you will be sent a letter of commitment from the bank. You can now show the letter to the modular home manufacturer or the landowner to let you buy the property and home. The commitment letter will contain conditions and restrictions you need to comply with. You may need to provide blueprints, and costs estimate before the loan can be closed.

Scheduling Disbursement

As your mortgage loan is approved, you need to schedule the amount you have to pay during the construction of your home. These include clearing of the land, the building of the foundation, the arrival of the modules to the site, and finishing the construction. As every milestone completes successfully, you have to make sure the vendors are paid. If everything checks out, the bank issues a check which you can use to pay the contractor.

Closing the Mortgage Loan

You will now show the disbursement schedule and clear other concerns from the bank like building permits. This will conclude the bank to sign the final documents approving your mortgage loan. You will need to pay for the closing costs involving lawyer fees and title fees. You will need to pay Construction loan payments and then permanent mortgage loan payments after the construction completes.

Construction of your modular home

Finally, with all documents settled, the manufacturer can start building your modular home. For every milestone reached, you will need to pay out vendors as per the disbursement schedule. You will also have to start making payments to the bank for the amount which has been disbursed. So the fees will increase as it progresses. If the construction time is condensed to 2-3 months, you will minimise the construction loan payments to the bank.

Transfer of Construction Loan to a Permanent Mortgage

When the construction completes, the bank assesses the house. After satisfactory inspection, the loan is turned into a permanent mortgage. As per your mortgage agreement, you will have to continue paying the payment for the interest and principal. You will need to pay transfer fees during the process.

This is how financing modular homes is done in the United Kingdom. You will have your perfect home for your family in the shortest time possible without the long wait and mess you have to deal with on-site home builds.

Impacts of shared appreciation mortgage

26/01/2017

Shared Appreciation Mortgage (SAM) is the now the biggest cause of a headache to pensioners and their descendants. The scheme started out in the 1980s and early 1990s. It all started with banks offering loans to people who had fully paid off their mortgages. This was an interest-free loan that was not to be repaid in monthly instalments. The lenders could repossess the loan in future after the sale of their houses upon the death of a beneficiary. In addition to the loan, the borrower had to repay the bank 75% of the profit that they made from the sale. The reasoning behind this scheme was that cost of housing would appreciate in future. That is why it was referred to as shared appreciation mortgage.

Initiation of Shared Appreciation Mortgage

Shared appreciation mortgage was a good deal at face value. The borrowers were getting handsome mortgages at no cost. They were not required to pay any instalments. They could live in their homes for years before worrying about the loan. Most banks did not apply any interest to the loan. This did not seem threatening because it was great to have loan without interest at that time, and the borrowers did not have to start repaying immediately after the loan was offered. Everyone saw easy money. A good number of borrowers consulted financial advisers and solicitors before taking the loan. The solicitors and advisers gave them the green light to take the loan. Even the prime minister of the UK at that time was thrilled with the scheme. He dubbed the scheme a Millennium Product. A sample of SAM loans was displayed at the Millennium Dome in London. You can only imagine the smile on everyone faces during the era of SAM.

Woes with Shared Appreciation Mortgage

The smiles of SAM era have now turned into frowns and tears. SAM is now haunting everyone who participated in it. SAM was offered with the condition that it will be repaid upon sale of a house or when the borrower dies. The borrowers are now either very old or dead. The living yet old ones cannot pass their properties to their posterity. If they do this, they will have violated the terms of the SAM. Most of these people cannot repay their loans without selling their properties. If they sell the property, the bank will take so much of their money that they will have nothing left to buy a different house. Given that they are old, they cannot properly take care of these properties.

Imagine a loan of £13000 for a property worth £50 000 in 1991. The property has appreciated in value to £250000. If this property is sold, the bank is entitled to 75% of the increase in value. This is 75% of £ 200000 and will be £187 500. The homeowner must also repay the original loan of £13 000. This means that the bank will get a total of £200,500 for sale of a house worth £250000. The owner will get only £49 500. You cannot buy a house with £49500. Once you sell your property, you are rendered homeless.

How mortgage arrears are handled?

17/01/2017

The mortgage is a critical financial incentive for buying properties. However, it becomes a problem when the buyer cannot pay back. The mortgage is a loan and like all loans must be repaid. The buyer usually repays the mortgage in installments after buying a property. Each payment reduces the amount of the mortgage by a predetermined proportion. The security for the mortgage is the property that it is used to buy. A lender may resale the property if the borrower defaults in making payments. Once a buyer fully repays the mortgage and interest on the mortgage, he becomes a full owner of property.

Mortgages are usually repaid within a given timeframe. The time it takes to repay mostly depends on the size of the mortgage. Larger mortgages are generally repaid over longer periods of time. A borrower may find himself lagging behind in payment at any time during mortgage the repayment period.

Mortgage arrears are as distasteful to the lender as it is to the borrower. Contrary to many opinions, it is never a lender’s desire to repossess buyer’s property. The process of repossession of properties can be complicated and costly. Lenders usually prefer giving their clients time and incentive to repay rather than take ownership of a property at the very first chance of opportunity. This attribute of lenders could be because of their inherent humanity or obedience to the rules of Financial Conduct Authority (FCA). FCA requires all mortgage lenders to keep their clients informed about the condition of their contract before, during and after the mortgage is loaned out. The lender must explain clearly the actions they will take if the borrower defaults in his loan repayment.

Lenders are never quick to repossess a property with mortgage arrears. They usually give borrowers opportunity to catch up with payment. The first thing that most lenders do is to contact the borrower. This is in keeping with the rules and regulations of the Financial Conduct Authority. The lender may then give the borrower more time to repay a loan, or offer him a repayment plan that is suitable to his current financial situation.

Lender’s course of action is usually guided by the borrower’s conduct during the loan repayment period. A borrower who has been diligently repaying his dues can enjoy more lenient measures such as adjustment of repayment plans. Lenders tend to be stricter to borrowers whose repayment has been odd from the day they were given a loan. These lenders can be taken to court and served repossession orders. Nevertheless, there is always a possibility of the repossession order getting suspended. This just shows how much the financial market is lenient to house buyers.

It is important for home buyers to plan how to avoid the inconveniences of mortgage arrears before applying for the mortgage. The borrower should only apply for something that he can repay. He should ask for an extension of the repayment period if he has to apply for bigger loans. Loans spread over a longer period usually, have smaller instalments.

How to go about Buying a House Without a Mortgage

19/12/2016

Buying a home is never easy. Houses are some of the most expensive properties in the UK. Real estate agents have come up with various methods of getting people to own homes without feeling the financial burden. They have come up with commonhold ownership and leasehold ownership to save people from the financial trouble of acquiring freehold properties. Mortgage lenders have also introduced various loan packages to help people in financing home ownership. These methods, though effective, have proven to be a burden in the long run. Commonhold and Leasehold properties have their disadvantages. Mortgages become a burden of their own in due time. These difficulties have prompted people to look for ways of purchasing properties in cash and enjoy the kind of home ownership that they desire. This is why many people are now paying for homes in cash. Buying a house without a mortgage might not be easy, but it gives you much relief once you are settled in your new home.

Plan early

Housing prices aren’t going down. And if have a plan of buying a house without a mortgage, it will take some planning. Check your finances, cost of living, salaries and other needs you’d like in your new house. Take a general look at the real estate trends in your area. And then find a house that suits you best. You can talk to real estate agents and find out the current housing plans and if there are any changes expected in the future. Once you find a good house, ask its price. Also, see if there are any special payment plans offered. You will be surprised at the number of real estate agents are considerate to prospective buyers in their payment plans.

Your ability to buy a house without a mortgage is largely dependent on your financial status. If you have the money, and you have found a suitable home, then you can initiate conveyance. All you have to do is talk to a solicitor. He will guide you through conveyance. He will tell you the documents that are required and the kind of research needed. The length of time till you purchase the house will vary depending on many factors. Your conveyancer will advise you on this too.

Save with the rising prices in mind

If you do not have enough money to buy a house in one ago, then you might want to start saving early. The sooner you get saving, the higher your chances of buying the house faster. Keep a little money aside from time to time. You may consider calculating the amount of money you save as proportion of the price of the house. This will give you a rough estimate of the time till your savings are enough to buy the house. Take into account possibilities of increase in house prices. You can talk to real estate agents or other experts about any foreseeable increase in house prices.

Payments by Instalments

Some people do not have the discipline to save money for that long. There is always a temptation to withdraw the money and use it for emergencies. If this is your problem, you can get around it by paying for the house in instalments. Some real estate agents accept small payments for a house. Look for them. The money you pay cannot be refunded. This method of payment is a security against any temptation to spend the money that is reserved for the purchase of the house.

Why you need help to buy remortgage properties

01/12/2016

Most people use mortgages to buy homes. Remortgaging is a new scheme for the purchase of property. Banks are now inviting current mortgage holders to take remortgages. Buyers need help to buy remortgage and properties on remortgages. They also need to know costs of remortgaging and the benefits of remortgaging.

You can get a loan by remortgaging a property. The loan-to-value is an important factor to consider when remortgaging a property for a loan. The lower loan-to-value increases your chances of getting the remortgage. Banks tend to shy away from properties whose values are lower than the amount of money they have to give away.

Things that help when you want to remortgage

When you want to remortgage a property, you must entice the lender to accept your terms. Most lenders evaluate a building by looking at it from outside. Very few actually get into the building to get a better approximation of its cost. You have to get the lender appreciate the value of the building as it is. Get them to take a look at the inside of the building. If you have done renovations recently, you should tell the lender this. Better still, give him documents to prove that you have increased the value of the property.

Remortgaging can help you consolidate your debts. You can use the money you get from remortgaging to settle other debts so that then only debt you have is the money from remortgage. This can only work if the money you will get from remortgaging is sufficient to settle the debts you want to clear. You have to hire a professional to help you evaluate your property before seeking remortgage.

Interest rates on mortgages are low at the beginning of the mortgage but rise as years go by. Remortgaging can help you take care of additional financial responsibilities that accompany increased interest rates. You can even avoid the high-interest rates by paying off the balance of the mortgage from the money you get from remortgaging.

Securing a Remortgage

The borrower must think about the cost of securing a remortgage. If you use a broker, then you should expect him to charge a fee. Some agents offer fee-free services. You should determine the services every broker provide and choose one that fits you. If you want to reduce your expenses, then the free broker is right for you. Other costs of remortgaging include legal fees, valuation fees and administration fees. You can use Annual Percentage Rate of Charge (APRC) to find out all costs of remortgaging, from the costs of securing remortgage, to the cost of interests.

Remortgaging can help you buy multiple properties at the same time. This you can do by using money from a property that you have remortgaged to buy another property. The best thing about this is that the properties you buy from remortgage will not even be attached to the lender. The property that is remortgaged will protect other properties from being securities to the debt. If you want to remortgage to buy another property, you have to ensure that the properties you are going to buy are of lesser cumulative value than the one you are remortgaging.

Mortgage Solicitors, Booking Fees And Other Costs

06/07/2016

Conveyancing for properties is essential when buying properties in the UK. Whatever type of property may it be starting from residential to commercial to leasehold, conveyancing is mandatory and must be done when buying and selling the property. Moreover, properties in the UK have different demands based on different regions and, therefore, their prices also differ. Some areas have higher fees while other areas have lower. In the previous article, we discussed what mortgage solicitors do and how they help you buy a property in the UK against a mortgage. We also discussed the arrangement fee of mortgage conveyancing that must be paid to the mortgager. In the following article, we will be discussing more on mortgage solicitors and what other fees are there that must be paid to the mortgager. Also, we will discuss the solicitor costs.

Mortgage solicitors and booking fees

Let us again start with the basics of what a mortgage is. A mortgage is the process of buying a property against and conveying to the creditor as security on a loan. In case of buying a property against mortgage, the property itself stays the security. As previously mentioned, buying a property on mortgage is not risky but it can be if you are not sure of being able to pay the credit amount in due time. Therefore, before deciding to buy a property on mortgage it is best to be sure about it.

The UK property market is very competitive with property prices rising each year. More people are flooding the country each year and due to attract of tourists, football fans and more – more residences are needed to shelter these people. Therefore, many properties are available and these properties have huge demand. According to locations, the prices differs and so best property are not always available at good prices.

The job of the conveyancing solicitor is to make sure that you as their client can get the benefit of the doubt by getting the property transferred to your name in the least amount of time possible. And when you are buying a property on mortgage, the responsibility of your solicitor increases as he is bound to give you advice on what decision to take. Also, they help you to process the booking fees of the property that you are planning to buy on mortgage.

The arrangement fee decision and the booking fee

In the last article, we discussed about the arrangement fee. So what should you do about it? You should add the arrangement fee to the amount of loan of the mortgage that you are taking and pay it off immediately. This way, you will not have to pay extra interest rate money on it. Ask your mortgage solicitor to help you get the deal in this manner as soon as possible.

The other type of fee that you must pay when buying a property on mortgage is the booking fee. This booking fee is usually charged by the mortgager to ensure that there is a secured fixed-rate. Thus, it is also known as the application fee. This fee is very less and costs about one hundred to two hundred pounds only. This fee must be paid as soon as the application for the mortgage is filed. This fee is completely non-refundable and so you can never get the money back no matter what happens.

In this two part articles, we discussed the two types of fees related to mortgage solicitor who help you buy a property by taking a loan from a mortgager. The best conveyancing solicitor in the UK will always help you and guide you properly. Therefore, it is best to take service from an accomplished mortgaging solicitor like Nigel Broadhead Mynard Conveyancing Solicitors who do conveyancing for different types of properties in and around the UK.

Mortgage Solicitors and Arrangement Fees

05/07/2016

Conveyancing is the process by which a person is able to buy or sell a property. In the UK, property conveyancing is mandatory and anyone who wants a property of their needs to do conveyancing. Conveyancing is done by a solicitor or a conveyancing solicitor. These are people who make sure that this legal process goes smoothly. Moreover, property buying has a few different options. Firstly, it can be bought in cash if you have the money. Also, it can be bought by taking loans. And most importantly, it can be bought by mortgage. The following article will discuss mortgage solicitors and what it costs to get a mortgage and how they help you buy a property in the UK against a mortgage.

Mortgage – the basics

Mortgage is buying a property against a loan and conveyancing it to the creditor. Buying a property on mortgage is not a risky thing but it can be if you are not sure of being able to pay the credit amount in due time. Therefore, before deciding to buy a property on mortgage it is best to be sure about it.

Also, not all properties might be available at good prices at all times. Therefore, if you suddenly find a property to your liking that is available at a good price then buying it straightaway is the correct decision. However, money of that huge amount might not be available to you in cash, thus, buying the property with mortgage is the only option left.

Mortgage fees

Many properties have one sometimes at least two mortgage fees. Of the two fee types, one is known as the arrangement fee. This arrangement fee is the charge or cost of the one who will be lending in the money. Usually, mortgages for home, thus, for residential conveyancing, it is given by financial institutions. In the past, this cost was usually administration cost of the mortgager but now it is also known as the arrangement fee.

It is the most important part of the whole process of getting a mortgaged property, thus, a mortgage. Your conveyancing solicitor will take care of this and it is also important to know that the interest rate of the mortgage will also be fixed during this process.

Mortgage conveyancing solicitors will take care of the whole process for you. However, many solicitors are too much commercial and do not give proper advice to the clients. Some conveyancing solicitor will advise you to check on the interest rates before buying. There are some lenders who hide high fees behind low interest rates. Therefore, it is best to check if the fee is actually justified or not. If you have doubts about it then ask your solicitor to help you understand it.

Usually, there are two type of combinations when you are getting a mortgage from a lender for residential conveyancing. One is high fee and low interest rate while the other is low fee and high interest rate deal. From these two, the higher fee is a better choice when you are taking a bigger loan. This is because a bigger loan takes a longer time to pay back. Thus, taking a bigger loan with a higher interest rate is not actually feasible. And it will be a foolish thing to do in fact. Therefore, ask your conveyancer what to take and also do your own personal research regarding the matter.

Usually, big money lenders or the person or institution lending you the money as the mortgage for your property conveyancing, will give you an option. That option being that you can pay the agreement fee up front. You can add that fee to the mortgage too – that option will also be available. However, it will not be a good thing to do as you will have to pay interest on that amount of money also. On the other hand, risk for paying it up front is that, that money is non-refundable. Therefore, if the buying process is hampered and you do not buy anything in the end – then that money will be lost forever.

The conveyancing solicitor will help you understand these complex situations that may arise when you buy a property with the help of mortgages. The arrangement fee is ranged from a hundred to more than two thousand pounds. Therefore, the best way is to go to a conveyancing solicitor who will give you proper guidance. Mortgage solicitors like Nigel Broadhead Mynard Conveyancing Solicitors do residential conveyancing in and around the UK.

Everything about Remortgage Conveyancing

22/09/2015

Remortgage Conveyancing is the conveyancing work in admiration of a remortgage exchange where the home loan moneylender is a bank or building society. In spite of the fact that this aide is principally gone for conveyancers since a loan specialist won't permit a borrower to complete his own conveyancing thus DIY conveyancing won't be conceivable, it will ideally give remortgage customers an understanding into the procedure moreover. You should know and understand the details of remortgage conveyancing completely before beginning the conveyancing work. A few organizations do take a business view in admiration of remortgages and will do significantly less stringent checks

What is remortgage?

Remortgaging is a procedure by which you can change you're loan specialist. The bank is the individual or firm which is loaning or has loaned you cash to purchase a property. Until you reimburse the advance taken from the moneylender, the bank will hold your property's title deed. A title deed is an authoritative record demonstrating that you are the property's proprietor. Without the title deed, it is difficult to offer your property. A conveyancing specialist, who is an expert in remortgage conveyancing, can assist you with excursion in such manner. The procedure is convoluted and exceptionally tedious.

Ventures in remortgage conveyancing

Applying for title deeds and recovery articulation

your specialist/solicitor will request your home loan record number and methodology your present bank with the same to apply for your title deeds. Once got he/she will check the title deed for any confinements or exceptional condition so that he/she may pass on it to your new loan specialist. The specialist/solicitor will likewise apply for a reclamation articulation from the present loan specialist at the same time to ease your home loan and exchange it to the new moneylenders. The new home loan must cover the present home loan.

Title issue:

At the point when acting in a remortgage some take the perspective that it is not important to execute as inside and out a title check as you would if representing a buyer since you are just needed to watch that the property is a decent security for the home loan advance. Remortgage conveyancing checks have turned out to be much excessively essential and the way that if a loan specialist needs to repossess, it will be offering to a person whose conveyancer will perform an intensive check and will anticipate that any deformities will be rectified, and not to another bank. The reality of the matter is that sure matters a loan specialist is unrealistic to be occupied with.

Important searches:

A neighborhood power hunt will be done to check the title deed and clear it. This is fundamental before the new bank can focus on giving you. The consequences of the quests can influence the property's estimation. The quests are: Neighborhood, Water and Liquidation seek, Land registry etc. The specialist/conveyancer will send you certain structures in which you have to top off insights in regards to your property once more. You will need to certify the adjustments that may have been done after the property was purchased. In the event that yes, then building regulations and authorizations must be connected along as evidences. On the off chance that the property is leasehold, it must be specified. Else, the property will be thought to be a freehold house.

Leasehold Properties issue:

On the off chance that the property is leasehold, you'll have to check the lease and you'll have to raise certain enquiries with the landowner/overseeing operators to check such things as whether the administration charges and rent are paid cutting-edge, who you have to serve notification of charge on and so on.

Contract deed

After the new loan specialist affirms of your recognizable proof papers, the moneylender will forward you a home loan deed which you have to sign in vicinity of a witness, for the most part a specialist. Once the deed is marked, your specialist can request your home loan monies from the new moneylender. On a finish date, your old home loan will be paid and the new home loan will be discharged. Any equalization cash owed by you must be paid by a concurred date.

Conveyance: Remortgage

01/03/2015

What is Remortgage

Basically the term remortgage is another extension of the idea of mortgage. Mortgage, you already know, is about reconsidering the ownership of a property of your own for a while and borrow a significant amount through this process during your needs. Mortgage is prevalent here in UK and people take in to account remortgaging whenever find themselves in need of money. Mortgage allows one to instant receive cash and get the job done by mortgaging the property to someone who needs that during the time and thus both are left with benefits in return. Remortgage takes place when a person who already is in a deal of mortgaging property with someone else, feels insecure regarding the amount of interest and also about being able to hold the mortgage in due time. He then remortgages the deal with one another and receives a remortgage deal where the risk is significantly lower than the previous and leaves the both in a win-win situation.

Why do I Remortgage

If you know about 'hedging', then this idea of remortgaging is just another reflection of the same. Remortgage reduces your risk or uncertainty associated with the mortgage in hand at present and secures you money with another deal with a lower possibility of risk. This risk is basically measured by the rate of interest implying on the deals of mortgages. If you happen to have a mortgage that leaves you with 0.5% of interest, then you remortgage the same with an offer where the rate of interest lies above 0.5%, this pretty much sums up the complex idea of remortgage to any amateur dealing in remortgage.

Whenever, the above is your situation, it is recommended to go for remortgage.

How to Remortgage Property in UK

  • You can remortgage your property at the time when you find a deal available to you where the interest rest is higher than the rate you have your property in mortgage at present. This happens, when you are in need of cash and don’t find a seemingly possible way to arrange the same within the limited time.
  • Remortgage is quite simple to do if you possess little knowledge regarding the money market in the country and also about the rate of interest available with the deals of remortgage.
  • The above requirement is often found to be difficult for the amateurs to fulfill and therefore, it is recommended to look for experts to rely on and get the job done so easy. Experts in remortgage are the few conveyancer, solicitor etc. who make your dealings happen within a short time span and leaves with your chunk of profit.
  • Remortgaging requires you to analyze the situation in the money market at present and reconsider your holding the property in hand on mortgage. If you successfully manage to analyze it, you should then quote your price and the rate of interest to the conveyancer or solicitor. It then becomes their responsibility to get you the quotes that fall under your requirements and thus makes an offer, become a deal.
  • Remember, whenever you remortgage your property, it’s a done deal; therefore make a remortgage where you pass on the fluctuating rate associated with your mortgage at present and take responsibility of the one with a fixed rate of interest instead. This reduces your risk associated with the mortgage and relieves you with a certain amount of profit in hand.
  • In case of fixed rate of interest, the deals can be 2 year, 3 year or 5 year remortgage deals. In such cases, pay attention to the features these deals allow you to benefit from.

What is involved with a Remortgage?

12/01/2015

If you are looking to release equity from your home through a remortgage then your mortgage company will likely insist that you hire a conveyancing solicitor to handle the paperwork. Depending on the size of the loan that you are seeking the mortgage company will require that they have a charge over the property. This is so that they can have a legal precedent to repossess the property in the event that you fail to meet the loan payments. So the mortgage company will require that you get a conveyancing solicitor to do the work at your expense.

There are many reasons why a person might remortgage their house but below are listed some of the most common:

  • if they are investing in a second home as a rental property
  • if they are buying a home as a holiday or retirement project
  • to raise capital to inject into their business
  • for home improvements to increase the value of their house
  • to buy a car or the holiday of a lifetime

Whatever the reason for the loan a property offers a flexible investment which is fairly easy to raise capital against. This is because the value of a property is practically guaranteed to rise over the course of a long term investment and so the mortgage company will be happy to lend money in the form of a remortgage based on this certainty. Of course if the housing market drops in the short term you could potentially find yourself in a position of negative equity, where you owe more on the property than it is worth. This is not a problem while you can afford to make payments but otherwise may lead to repossession.

It is very common for people to have more than one mortgage registered on their house. One problem that can arise from this is when you come to sell the house. It is more time consuming for your conveyancer to remove more than one charge from the property so they will probably raise an extra fee for each extra mortgage that they have to redeem on your behalf. Even if you finish paying your mortgage the charge may remain until a conveyancing solicitor is paid to get it removed. Just because they still have a charge on the property doesn't mean that the bank would be able to repossess your house though if they had less equity invested in the house than you.

You might wonder why the bank can't just increase the mortgage account that you already hold with them. This is probably because it would be more work for them to shut the old account down and create a new account with a bigger limit. When you entered into the original contract the term was set and the interest payments calculated. The new loan would likely involve a new product with a new contract and a different set of terms and conditions. It is easier for them to add the new loan as a new product. This also means you could potentially get different remortgages from different lenders.

NBM conveyancing solicitors are on the panels of all the major mortgage companies so we know we can act for you in your transaction. If you plan to go to another solicitor you should first check that they can represent you and your mortgage company.

So if you have read this article and considered the information within it and you think arranging a remortgage might be the right way for you to release some equity from your home why not try the instant quote system and check the price of NBM Solicitors remortgage service?