One of the most important points at the start of your property journey, before you even get ready to make your purchase, is to ensure you have enough saved to cover the deposit. We regularly hear first time buyers in Birmingham that this part can sometimes be a little tricky.
Quite a common way around this, however, is for someone close to you to help you cover either a portion of the deposit or the full amount. This is called, quite aptly, a gifted deposit. In order for a gifted deposit to work, there will need to be an agreement that this is purely a gift and not a loan to be paid back.
For many, they benefit a lot more from buying a property and obtaining their own mortgage, than they do when renting from a landlord or local authority. There are lots of reasons for this, with one being that your monthly payments could be a lot less than you might have been paying per month on rent.
If you have worked out that you’ll be able to afford these monthly mortgage payments but can’t afford the initial deposit, then this is where a gifted deposit can become useful. In some cases we even see a gifted deposit being added onto an already saved deposit, increasing the amount.
The more deposit that is put down initially, the better rates you are going to open yourself up to. This in turn offers quite the benefit to home buyers, as you are guaranteed to lower your monthly mortgage payments in doing this.
We usually find that it is people’s parents, whether that be their birth parents, adopted or sometimes even carers, who are the ones that will gift a deposit. Across the industry, online and in person, you may see this with the tagline “The Bank of Mum & Dad”.
There are a few lenders out there who will possibly allow deposits to be gifted by some other family members such as aunties & uncles, though this will require your dedicated mortgage advisor to take more care when searching for the right mortgage lender to use.
If anyone over the age of 55 is willing to give you a hand, they may have the option of taking out an equity release in Birmingham as a means of gifting you a deposit.
When we have our primary chats with customers who are in the situation where they are struggling to save for a deposit, we will usually ask if they are able to be gifted the deposit from someone they know.
In those instances we either hear that they didn’t even know their parents could help, or they do know but don’t feel like they can approach them about the topic.
The reality is that if they are able to do so, most parents are more than happy to help their children if they can. Inheritance can help them achieve this, with some parents opting to gift it early if they have enough saved. We have also had cases where equity release has been used to help them out.
Lenders are not particularly keen on working with customers who take out loans for a deposit. The reason for this is because it is an additional financial commitment that could possibly get in the way of your mortgage repayments.
It’s not like there aren’t lenders out there who will accept this, because some of them will, it just makes for a more difficult process.
The majority of lenders out there won’t give you a mortgage unless you have at least a 5% deposit. Some may want more than this though and is entirely dependant on the lender and the situation. Bad credit, for example, will usually mean you have to put down at least a 15% deposit.
When it comes to gifted deposits, there is usually no limit to the amount that can be gifted. As mentioned earlier, the more you have, the better the rates you open yourself up to and the more likely you are to save money on your monthly payments.
Gifted deposits will mostly be beneficial to a first-time buyer in Birmingham or a home mover in Birmingham. It can also be a helpful tool to use alongside the Help to Buy Scheme in Birmingham.
Depending on the lender that your mortgage advisor in Birmingham selects for you to go with, the required 5% deposit can be paid via gifted deposit.
As a general rule of thumb, all mortgage lenders will require a gifted deposit form. You may be asked to provide additional proof and ID (such as a donor ID or bank statements).
This all depends on the lender that your mortgage advisor in Birmingham feels is right for you and your personal circumstances.
Taking out a mortgage is one of the biggest financial commitments that you’ll make in your life. This is because it is going last around 20-30 years. Furthermore, this is why you need to be prepared and know exactly what you are signing up for.
Quite a lot of people get a mortgage with the mindset that they’ll take one out and not need to think about it again, they just need to pay it off. This is not the case…
In Birmingham, when you take out your mortgage, it’s likely that you’re fixing yourself into a short fixed-term rather than a 10+ term. This is because lenders usually offer shorter 2-3 year mortgage products over longer deals.
Once you get to the end of your term, your will lapse straight onto your lender’s standard variable rate of interest (SVR). This rate, when compared to your current rate, will likely be higher and increase your mortgage payments. Moreover, if you were to have a mortgage review before your fixed term ends, you could end up saving money.
As it’s coming up to the end of your mortgage term, you should start thinking about remortgaging in Birmingham. Getting a mortgage review booked in with a remortgage advisor in Birmingham could help you access a better, competitive product.
A mortgage review is simply a review of your mortgage (we probably didn’t need to tell you that).
Mortgage reviews will allow you to find out whether you can access a better mortgage product at the end of your term or not. For you to get one, you’ll have to book an appointment with your mortgage broker in Birmingham, lender or building society and make them aware that you want to review your mortgage options through a remortgage.
You may be able to access a better rate by taking a mortgage review!
The mortgage review process is just like any other mortgage process. You will be asked to supply evidential documents that support your affordability, you are who you say that you are, etc. Once your mortgage advisor in Birmingham has all your information, they can begin searching through products.
If you managed to maintain your mortgage payments, your credit score will have had a boost during the period of your mortgage term. You will have proven to your lender that you are a reliable applicant. The higher your credit score, the better chance you have of being able to access competitive products.
Unfortunately, sometimes you won’t be able to access a product with a ‘better’ rate. In this situation, you can speak with your lender and see whether you can simply renew your deal for a further couple of years. When it comes to the end of your next term, you may have the chance to access better deals then.
Birminghammoneyman offers a free mortgage review to every applicant, so book online today and speak with an advisor.
Mortgage reviews are very important. It’s vital that you keep on top of your remortgage situation so that you know exactly where you are and where you stand. This will be worth your while if you access a competitive deal from taking a review.
You could end up saving a lot of money in the long term. It would also prevent you from slipping onto your lender’s SVR, which could be expensive.
Every lender’s SVR is different, but it’s all worked out the same way. They track the Bank of England base percentage and then add their own on top. This is why their SVR can be so expensive. If you are happy with paying their payments, it’s completely up to you.
Even if you don’t get around to taking a mortgage review and end up on your lender’s SVR, you can still remortgage any time after. You aren’t locked into a specific deal or term on your lender’s SVR, so you can contact your advisor when you want to.
It is possible to switch products whilst still tied into a deal, although, it will cost you. If you find a product that you like and want to remortgage in Birmingham before your term ends, you will have to pay an ERC (early repayment charge).
Remember that you are not required to stay with the same lender through a product transfer, you can remortgage if you believe that there are better deals elsewhere.
With the constant increase in housing prices, you may have got lucky and there will be lots of equity within your home. If this is the case, you may be able to access more competitive products.
Mortgage interest rates are based on loan to value ratios. By rule of thumb, the more equity you have, the lower the interest rates you will be able to access.
Capital raising is also an option that is available to you, so if you are interested in this, please speak with an expert mortgage broker in Birmingham like us.
If you haven’t owned your home for long or your home hasn’t increased in value yet, there may still be money-saving options with your current mortgage lender.
Keeping up to date with your mortgage payments is key, if you manage to, you may find that you’ll be able to access some product transfer deals.
Sometimes, the products offering the lowest rates may not be the best deals. These types of deals are known to come with high set-up/arrangement fees.
As a mortgage broker in Birmingham, we consider every cost that comes with taking a mortgage. We will also take these costs into account when trying to find your mortgage products. We want to save you as much money as we can.
When looking for a mortgage product, we will try and find one that matches your personal and financial situation. Get in touch for Remortgage Advice in Birmingham today.
Your journey into the world of mortgages can be a rewarding endeavour. By the end of your process, you will likely end up with one of the following applying to you;
No matter which of these was your desired route, there will eventually come a time when your mortgage term is nearing its end. At this point you will have several options;
A remortgage is where you will use the proceeds borrowed from a new mortgage, in order to pay off a mortgage that you already have. There are a large amount of different options when taking out a remortgage, ranging from smaller options, to much larger options.
Generally speaking, the initial mortgage deal you’re on will last around 2-5 years, featuring lower fixed rates or possibly even rates at a discount. In some cases you’ll find yourself placed on a tracker mortgage which will follow on with the Bank of England’s base rate.
Most customers will fall onto their lenders Standard Variable Rate at the end of their term (you may see this mentioned across the web only as SVR).
To briefly explain this, an SVR is a mortgage that has an interest rate determined by what the lender wishes to charge and it can change. This also won’t follow the Bank of England’s base rate like a tracker mortgage would.
Because of the nature of them, these are usually the most expensive mortgage routes to take, leaving many to look at their options for remortgaging to get better rates, which will hopefully save you a good amount of money on your monthly mortgage repayments.
A few years into your living in your home, you may decide that something is missing. Maybe you need an extra room or larger living space for your kids or belongings, a new kitchen, a new office, or converted loft.
Rather than move to a larger house, many looking to release equity by taking out a remortgage at the end of their term, so that they can cover the costs of these plans.
Project planning and managing can seem a little daunting, especially when you have to factor in getting planning permission. That being said, others would maybe say that it’s a lot less stressful and more rewarding than the process of finding a new home, selling your current one and having to move everything you own.
Further down the line, this may prove to be even more of a beneficial plan, as creating more space and having good quality craftsmanship will likely increase how much your property is worth, which is useful for if you ever do decide to sell your home or rent it out.
Sometimes we find when speaking to customers that people may also wish to remortgage in Birmingham for a better mortgage term, by reducing the length of the term they are on or switching to a product that is a bit more flexible for their needs.
When you reduce how long your mortgage term is for, it means you won’t be paying back your mortgage for as long, though it also means that your monthly repayments will be a lot higher. The longer that you take out your term for, the lower your monthly mortgage payments will be.
Some customers may choose for a more flexible mortgage term. In doing so you may gain the ability to overpay your mortgage, which results in your mortgage being paid quicker. It can also give you the option to carry the same mortgage and rates over to another property, if you ever need to in the future.
Though a flexible mortgage sounds like the ideal mortgage type, they usually come in the form of a tracker mortgage, which as mentioned earlier will follow on from the Bank of England base rate. This will mean that one month your payments could fluctuate based on interest, making them a little inconsistent & unreliable.
Everyone that owns a home will have some level of equity in their property. This can be worked out by looking at the difference between what’s left to pay on the mortgage and the current value of the property.
As discussed briefly earlier, remortgaging can be used to fund any potential home improvements. Still, there are more options out there than just that. Some homeowners will use it to cover long-term care costs, boost their income, have a well-deserved holiday, pay off an interest-only mortgage, or free up some spending money.
Sometimes when speaking to customers, we’ll also find that some buy-to-let landlords in Birmingham will use equity release as a means of covering the necessary deposit to purchase an additional property for their existing property portfolio.
Whilst we’re mentioning the topic of equity release, we should probably mention another big one people use their equity for, that being to pay off any unsecured debts that may have built up over time.
Though it may seem easy to the untrained eye, debt consolidation bases not only takes into account the amount on how much owe on your debts, but also the value of the property and the state of your credit rating. Because of this, you may be limited in the amount you are allowed to borrow for a mortgage.
On top of this, to pay off your previous mortgage and your debts, you will need to borrow an amount that is higher than your outstanding mortgage amount. This will mean that your monthly repayments will probably be higher. Granted none of this is ideal, but you can worry less knowing that you have some options out there if things don’t go to plan.
If you find that you do have a particularly damaged credit rating, you still have options out there. You must bear in mind though that these will not be easy and require very specialist remortgage advice in Birmingham first.
Even with a specialist on hand, there is no guarantee you will definitely obtain a mortgage. You should always seek mortgage advice prior to consolidating and securing any debts against your home.
If you are a homeowner nearing the end of your mortgage term, wondering what your options may be for remortgaging, we definitely recommend that you get in touch with a knowledgeable and reputable mortgage broker in Birmingham today.
A dedicated and trusted mortgage advisor in Birmingham will help discuss your circumstances, creating a game plan for the next step of your mortgage journey. It’s always our aim to ensure the second time around is quicker and smoother than your previous mortgage experience.
Some people prefer to know how much their monthly mortgage payments will be. If this applies to you, then a fixed-rate mortgage would be better suited for your circumstances.
A fixed-rate mortgage is when your monthly mortgage payments will be a set amount every month. You need to be aware that the longer you fix for, the higher the rate becomes. But this will not change the duration of your term, which can vary anywhere from 1-10 years.
If you are looking for a cheaper fixed-rate mortgage, make sure to avoid taking out a longer rate. Otherwise, you could face much higher interest rates if you take one out any longer than 2 years.
If you take out a mortgage for ten years at a certain percentage, interest rates might have risen during your term, leaving the lender out of pocket whilst you’re sitting comfortably on a lower percentage.
That presents a higher risk to the lender, so longer terms tend to come with higher rates. In sticking to a shorter-term fixed-rate mortgage, you will find yourself with a better rate, but only for that two years.
Those two years will eventually come sooner rather than later, implying that you will have to start searching again for more deals at the end of the mortgage.
If the interest rates have risen during the duration of those two years, then you could be faced with higher payments than you were used to at the start of renewal.
If you prefer to limit searching for new deals every two years, then maybe you would better suit a 5-year rate. By fixing it for five years, you would have a stable recurring payment for a much longer time.
As previously discussed, being on a fixed-rate mortgage for 5 years will mean that you will be paying more per month than you necessarily would on a two-year rate.
When people consider taking out a long-term, they usually range anywhere from 7-10 years. Long term fixed-rate mortgages were never a popular choice to choose, and they aren’t something we would recommend. But, like most mortgages, there are both pros and cons to taking out a long term fixed-rate mortgage.
Anything could happen within a decade, so committing to a fixed payment for as long as 7-10 years may create problems with lenders. If the rate suddenly drops below your current rate, instead of rising. You may end up paying well over what you otherwise would’ve been, and once you are in the deal, you cannot get out of it.
A Repayment Charge (ERC) is where something happens that affects your financial situation. This leaves you having to repay your mortgage earlier than you had initially expected and, your lender may present you with a charge.
How they calculate the charge is they calculate a percentage of the remaining that you owe. An example would be if you manage to pay off your £100,000 mortgage early and your ERC is 4%. You would be charged a £4,000 penalty as you have broken the fixed-rate contract.
Nobody can get away with not fullying paying off their fixed rate and will still be charged with an ERC. For example, if someone is aware that their fixed rate is due to end soon. But start looking up deals for their next fixed-rate mortgage.
If they find a great deal and think that the rate may increase, they may look to pay off the rest of their fixed-rate payments to switch to this new deal, even though this, of course, comes with additional charges.
We advise that you avoid chasing “headline” deals advertised. Chances are, your circumstances may have changed, and you’re not guaranteed to get it at the rate you were hoping to achieve.
If you are a first time buyer in Birmingham or moving house and would like more information or some help with a fixed-rate mortgage, our experienced team of mortgage advisors will be on hand to provide any assistance they can.
Remember that the lowest rates come with the highest setup fees, which some customers are keen to avoid. Get in touch today for more fixed-rate mortgage advice in Birmingham.
Once you have gotten the hard part out of the way, that being saving up for your deposit (or if you’ve utilised a gifted deposit) and have decided you are ready to buy your first property as a first-time buyer in Birmingham.
The next step is to get yourself prepared for the mortgage process that is about to follow.
In our experience as a mortgage advisor in Birmingham, we have found that customers benefit the most by getting in touch with a mortgage broker as early on in your process as you can.
Your dedicated advisor will help you to work out an outline of the amount you could be looking to borrow for a mortgage and how much your monthly mortgage costs could be.
Before anything else, your top priority should be to obtain an up-to-date credit report. You ideally don’t want any credit issues such as a missed phone contract payment, to hold you back from a mortgage. A credit report will be able to show you potentially harmful factors.
Following these steps will give you a realistic overview of the likelihood that you’ll succeed with a mortgage and what your budget could be. This will help you to organise your accounts, such as any existing credit cards or phone contracts.
Our hard working and dedicated mortgage advisors in Birmingham are able to obtain a fully credit-checked agreement in principle for you, within 24 hours of your primary mortgage appointment.
There’s a lot of important paperwork for you to gather for your process, so it’s a good idea to start organising what you will be required to have ahead of looking for your mortgage. In doing this, you possibly enable yourself to go through the process quicker.
We need to be able to prove your identity. With this, you’ll need to provide us with some photo ID such as a driving license or passport, so that we can prove who you are.
On top of this, you’ll need to prove where you are living. To achieve this, you need to send us a utility bill or original bank statement that has been dated within the last 3 months of your current home address.
One of the most important factors when seeing if you qualify for a mortgage, is analysing your income and spending habits. This can can be a big difference maker in whether or not you obtain a mortgage. Your bank statements should show your income and what you having regularly going out.
Lenders will not be too thrilled to see gambling transactions on your account. They also won’t be too happy if you go over an agreed overdraft limit or if your direct debits regularly bounce.
It’s best to plan ahead regarding your bank statements. The more organised they appear to be, the more likely you are to be accepted by a mortgage lender.
You will have to prove you have the financial capability to pay for the deposit and also evidence where this came from for the purpose of anti-money laundering.
Try not to move money around your accounts too often as it will make auditing where everything came from a little complex. Lenders like to see you build up your savings, so you’ll need to provide individual proof for any large financial deposits into your bank account.
We regularly see that money for deposits has been given as a gift by a member of your family. The gifted funds also need to be evidenced, with the “donor” needing to sign a letter to confirm it is a gift and not to be paid back as a loan.
Regarding being able to afford a mortgage, the most important thing is to be able to prove your that you are financially capable to keep up monthly mortgage repayments.
If you are a regular employee, the proof you will be required to provide is the last 3 months’ payslips and most recent P60. Lenders can take into account frequent overtime, commission, shift allowance and any potential bonuses.
If instead you are an applicant who is self-employed in Birmingham, then you’ll need to enlist the help of your accountant. They will help you request your last 2 or 3 years’ tax overviews and tax calculations documents from HMRC, which you can use for proof of income.
When taking out a mortgage in Birmingham, it really is a good idea to prepare yourself ahead of the process starting. Make note of what you expect your outgoings to be after you move and work out what you are able to afford.
Factor in costs like council tax and utility bills, food, drink and leisure activities. This will demonstrate how much money you actually have free to put towards monthly mortgage repayments.
It may seem like a difficult process, but without taking the steps we mentioned above, it is not possible to proceed with any lender or broker. Once you have taken the necessary steps, you’ll be just that little bit closer to your home owning dreams.
It’s better to prepare yourself in advance, making a collection of everything a mortgage lender might wish to see. This saves both your time and frustration further along the process, especially if it’s something that could’ve easily been arranged at the start.
A mortgage agreement in principle is basically an obtainable document or certificate of confirmation that proves to the estate agent or seller of the property that ‘in principle’, the bank is willing to lend you a certain amount for a mortgage. You may also see this called a decision in principle.
This is something that we will always look to obtain for of our customers if they don’t have one already, and something we can usually get within 24 hours of your initial appointment.
In order to obtain an agreement in principle, you will have to pass the lenders credit score. This works out well because in almost all cases, this is a very good sign to the lender that you are creditworthy and could be trusted with a mortgage.
If you are in the market for buying a new home as a first time buyer in Birmingham, then an estate agent will often want to check again and again in order to make 100% sure that you are ‘mortgage ready’ when it comes to making any offers on a property.
In having this certificate on hand, you will prove to the seller that you are able to obtain a mortgage for the amount you will need to purchase the property and are ready to proceed with the sale.
A mortgage agreement in principle will not be a definitive guarantee of being able to obtain a mortgage, as the rest of your full application will require further background checks (such as evidencing your income) and having a property valuation undertaken on the property you’re looking to buy.
As an experienced mortgage broker in Birmingham, we highly suggest that all customers try to obtain an agreement in principle at the earliest opportunity. This is because of the following reasons:
1. Negotiating Power.
2. Avoid Disappointment.
3. Knowing Your Limits.
Once you reach the point of being able to make an offer on a new home, the majority of estate agents will undertake the necessary steps to ensure that you can go forward with a mortgage on the property.
Generally speaking, they will require you to provide them with evidence that you are able to afford the purchase of the property, prior to listing the property as sold and taking it off the market.
If you have already managed to have a mortgage agreed prior to making an offer on the property, you’ll come off as more appealing to the seller.
This will also prove to the seller that you’ve put a lot of careful thought about your mortgage journey and not just decided to purchase out of the blue, with no preparation.
This might persuade a seller to accept any offers that you make that are lower than the initial asking price. Make sure not to make offers too low though, as you don’t want to insult the seller.
When it comes to making a purchase on a property, we often find that customers can go full steam into the process, making an offer on a property without making sure that they can afford to actually buy the property in the first place.
This could lead to customers facing potential disappointment if the mortgage application happens to fail, as by that point they may have already had their heart set on that property.
By getting in touch with a mortgage advisor in Birmingham early on, the potential disappointment that you otherwise would’ve faced could potentially be avoided.
Often, there are various factors that are causing a mortgage to decline that can be overcome with a little time and the guidance of a trusted mortgage broker.
If you know you have a good credit rating because you’ve never been turned down for credit, have paid everything on time and are registered on the voters roll etc, it is still worth getting in touch with us for mortgage advice in Birmingham.
You might find that you could approach various different lenders and each time get a different max mortgage amount back from them. These lenders all calculate affordability in their own unique way, with their own individual criteria.
If you are self employed in Birmingham, though the mortgage process is not completely impossible to navigate, it can be very complex for self employed applicants, without the assistance of a mortgage broker in Birmingham by your side.
Some lenders will take your net profit, others are known to use your salary and dividends. Some use your latest year, whereas some others will use an average over three years.
Being aware of your borrowing limits is very important when it comes to applying for a mortgage, as then you have a realistic idea of what your price range on a property is going to be.
Our team of mortgage advisors in Birmingham will be able to give you a guide of the potential maximum mortgage available to you and help you to work out an estimate of the amount you’ll possibly be paying back per month for your mortgage.
For some, buying a house and taking out a mortgage is a daunting experience and arguably one of the most significant financial commitments of your life.
In your case, it would be best to prepare and save for a large deposit before proceeding with a mortgage in Birmingham.
After all, deposit amounts, purchase prices and loan-to-value percentages for first time buyers vary based on the individual and their circumstances. We recently carried out a study on first time buyers in Birmingham compared to Coventry to see the averages for these variables. Here is a closer look at the data:
We find that higher house prices require a higher deposit to receive better rates for the borrowing amount.
When looking at house prices in the West Midlands, the average deposit is the same across the board. The study showed that the average first time buyer deposit amount in Birmingham is around the £32,000 mark, whereas in Coventry, the average was around £35,200.
Many first time buyers can save up a portion of their deposit for themselves; others received a gifted deposit from a family member or a friend.
Having this gifted deposit provides extra support if the first time buyer struggles to make up the remaining funds. A gifted deposit can lead to more competitive products and lower interest rates.
House prices in the West Midlands are relatively balanced out. Birmingham average purchase price is £181,000, only a 12% increase from the rest of the neighbouring areas like Coventry which stands at £205.750.
Your loan-to-value percentage is calculated by dividing the mortgage amount by the property price and multiplying by 100.
The lower the loan-to-value, the more favourable rates you are likely to be offered. Reflecting on the data gathered, the average LTV in Birmingham comes in at around 82%, which is 1% less than Coventry.
With a vibrant economy, some very affordable living and a friendly atmosphere, Birmingham and its surrounding areas are a prime destination for people to live.
With gifted deposit popularity on the increase and lower interest rates, Birmingham could be ideal for first time buyers to invest in their first home.
As a mortgage broker in Birmingham, we would advise that you speak to your mortgage advisor and get an agreement in principle turned around as quick as possible so you can start your first time buyer mortgage journey in Birmingham right away.
The right to buy scheme in Birmingham allows individuals living in council properties the opportunity to purchase the property they’re living in if they have lived there for a prolonged period of time.
You will be offered the opportunity to purchase at a discounted price. This proposed discount will be used as your deposit meaning you are able to organised your remaining savings to help with the rest of the process.
The right to buy scheme in Birmingham was deemed helpful around the time of the ’80s when it allowed a lot of individuals to become homeowners for the first time. On the other hand, it was deemed controversial.
The main reason for this is due to the dilemma of the scheme turning the homes into privately owned therefore taking them off the public sector, this can be a disadvantage when there is already a housing shortage. As a result of this, the dynamics of council estates have changed.
If you’re interested In the right to buy scheme, the first step is to see if you’re eligible to purchase the property; this is done by completing an RTB1.
Following this, a person will arrange to value your property and inform you how much the property amounts up to. From this, you’ll find out the percentage discount you’re entitled allowing you to gain more of a level idea of future figures involved with the mortgage.
You will then be able to move forward after filling out forms included in a pack that will be sent to you by your local authority allowing you to move onwards.
The way that Lenders will calculate how much you’re able to borrow is done in the same way as any other mortgage: based on your income and expenditure.
This means that it’s still important for you to look ahead and be sensible with your finances, along with checking your credit score.
There are fees involved just as there is with other mortgages so you can prepare and be ready. These can include:
The right to buy scheme was set up so that individuals were able to have a wider opportunity to become Homeowners.
To be able to start their journey on the property ladder. If the involved property is sold before a certain amount of time, then you will be issued a penalty.
This will be in the form of repaying a sum of money linked to the original property discount generously presented at the start of the process.
It is certain factors that people are deterred from the right to buy scheme. Such as carrying out their own repairs and maintenance that come with owning a home.
On the other hand, the majority of people who do wish to take the opportunity, do so because if they tried another way, it may prove more difficult.
The government’s Lifetime ISA is a government scheme introduced back in 2017. However, the government scrapped this scheme back in 2020 as they decided to push the Help to Buy Equity loan over its predecessor.
A Lifetime ISA helped first time buyers in Birmingham save up enough savings for their first property.
For short, the ISA (Independent Savings Account) is a savings account where your money grows tax-free. Although there is no minimum of how much you can save each month, you can only put in £4,000 a year into this account.
As a bonus, the government top up your total annual savings by an extra 25%, so if you hit the £4,000 mark, you will receive an extra £1,000 tax-free, making your total yearly savings to £5,000.
Worry not if you don’t hit the maximum. Even if you save £720 per year (£60 a month), you will receive an additional £180 tax-free from the government.
You should know that you cannot withdraw it once the money is inside the savings account without paying a fee.
We recommend looking at the Lifetime ISA when you need that extra support to afford your deposit or planning to buy your first home within the next couple of years. Having that spare time, you can keep adding more money to strengthen your ISA until you are ready to withdraw the funds for your first property. You can find more information on GOV UK- Lifetime ISA.
If you were lucky enough to open a Lifetime ISA savings account and have saved enough for a housing deposit, feel free to get in touch with your mortgage broker in Birmingham, and let’s begin your mortgage journey.
If you have a Lifetime ISA opened or curious about other help to buy schemes in Birmingham that could match your situation. Now could be the perfect time to contact an expert mortgage advisor in Birmingham.
Our mortgage advisors don’t just specialise in Lifetime ISA’s. They have experience with other mortgage types, and we aim to help customers get onto the property ladder.
As we saw over the course of the coronavirus pandemic, the idea of working from home is now becoming increasingly popular. There are those who maybe would’ve never thought to work from home, now very fond of doing so once their hands were tied and they had to. Many are now fully converting their kitchen, living room, or even a bedroom into a home office.
A lot of these were already working from home, and some businesses now actually prefer for their employees to work from the comfort of their home, rather than going backwards and forwards to the office. This in turn would be saving you a lot on travel expenses, saving you money.
Interest rates for the time being are low, and these are the lowest interest rates we’ve seen for mortgages in a long time (at the time of writing this post; 06/07/2021), making it a good time for people to borrow money. Remortgaging in Birmingham for home improvements to make a home office can make quite a large huge difference, such as:
Especially now that we live in an age of great technological advancements, lots of homeowners consider getting a Remortgage in Birmingham for additional funding to put towards home improvements to convert a room or perhaps a garage to a new home office.
Assuming an interest rate of 2% is possible over 25 years it might cost you:
That’s probably not too much more than what you are currently paying and it can make sense for a lot of people to choose the route of improving their home, as opposed to moving, especially when you consider the stress and cost involved in buying a new home.
Many factors will impact how much you will have to pay back per month and how much you can borrow overall. It is down to exactly what you’re looking to do and how you’re looking to do it, such as the size of the extension.
You will also need to consider that if you’re looking to remortgage, you will have to go through another affordability assessment, even if you go through the same lender and just switch deals.
If you’re looking to remortgage for any home improvements, there is no better time to look for a remortgage deal than the present.
As a dedicated remortgage advisor in Birmingham, we are able to search through thousands of remortgage deals on your behalf, looking to find the perfect one for you and your situation.
Having a hard working team of friendly mortgage advisors in Birmingham by your side could help simplify the mortgage process, saving your time and money throughout.
We offer all our new or existing customers a free mortgage consultation. Get in touch with us today to book your free remortgage consultation in Birmingham & we’ll see how we are able to help.