The term ‘gazumping’ may be one you have heard before, however, have no idea what it’s about. The word ‘Gazumping’ is used when the seller of the property you are interested in accepts another offer from someone else prior to the sale of the property to you is completed.
Derived from the Yiddish word ‘Gezump’, in which someone swindles or cheats someone out of something and was used back in the 1920s, ‘Gazumping’ has been related to house buying and was a common term in the 1970-80s.
Through our experience as a Mortgage Broker in Hull, we have had the opportunity to speak to customers regarding Gazumping. The most common topic surrounding gazumping is if it’s illegal. Unfortunately, Gazumping is legal despite how immoral it is.
This is a question that is in many people’s minds when they are going through the home buying process across England and Wales. Thoughts of why and how this practice can be legal despite its lack of morality are a common occurrence.
Gazumping is deemed a legal act because the deals you make between you and the seller aren’t legally binding until written contracts are exchanged by lawyers. Therefore, the seller has no obligation to hold onto the property. All the essentials are agreed upon verbally up until your deal is completed.
The concept of being gazumped can be very daunting amongst lots of home buyers especially with First Time Buyers in Hull, regardless of whether there is a chance of it happening. It comes with the possibility of losing your dream home. It’s an event that no one wants to happen, in particular, for those who are a part of a property chain.
Another factor that can affect home buyers being gazumped is the idea of them losing money over the event. Non-refundable expenses that come with the home buying process like property surveys, conveyancing fees and mortgage arrangements fees.
As mentioned, the agreement between both parties to buy or sell a property is not a legally binding one. It only becomes that when the lawyers undergo the exchanging of contracts.
It’s not as simple as it sounds. The process can come with long delays that are usually several weeks from having your offer accepted to the exchange of contract.
Usually, this certain time period can be where other prospective First Time Buyers in Hull may interfere in the process between you and the seller by making a more favourable offer on the property. This can happen through them speaking to an estate agent or by going directly to the seller.
The more favourable deal may have been a higher purchase price, a faster sale or a particular buyer who has no pressure from a property chain. Gazumping covers all these circumstances that the seller would prefer in the midst of your mortgage process.
One factor that could impact the chances of being Gazumped by a seller is whether the market is a buyers or sellers market.
For example, if the market is currently a sellers market, this means that the market is hot. This will involve a high demand, fewer properties, people wanting to buy and bidding wars between buyers that could make the prices rise. In this circumstance, Gazumping is more likely to take place because could come to the seller at a much higher price.
On the flip side, if the market is currently a buyers market, this will come with more houses than buyers, a seller may not be receiving as many offers. This means you have less chance of someone Gazumping you and means you have much more room to negotiate on price.
To keep up to date with the current state of the market, check out our Mortgage Market Updates video on Moneyman TV presented by the Moneyman himself, Malcolm Davidson.
One of the reasons why the delay may happen between the offer getting accepted and the exchange of contract between two parties could be due to needing a property survey carried out. This involves your conveyance undergoing the appropriate searches and you will receive your mortgage.
Below are some helpful ways to help increase your chance of advancing further to mortgage success and avoid being Gazumped.
There are plenty more mortgage tips out there that you can benefit from during your mortgage journey and increase your chances of getting a mortgage.
It’s best to start by asking them to remove the property from the open market, this can be stated in the mortgage offer. By doing this, you have made the property less visible to people, therefore, reducing any more offers being made which will then reduce your chances of being Gazumped.
This is more of a negotiating point so the seller doesn’t have to agree with this because there is no obligation. Despite this, we do find that sellers these days respect this request from a buyer. Even more so if they haven’t been receiving as many offers already.
Putting in place a lock-in agreement, where both sides put down a deposit towards their binding agreement can be another helpful thing to do. If any one party chose to withdraw or change the deal, the other party would take their deposit.
You may find that there are legal fees in this circumstance which can make it a costly decision. However, you may feel that having this set up is worth the money and provide security during your mortgage process.
Another option is to look at the potential insurance products that could protect you against the prospect of Gazumping. This will work by the policy being paid out in the event of being Gazumped which, in turn, will reduce the risk of losing money from the fees you have potentially paid in the process.
Even though Gazumping is never guaranteed to be prevented, there are a plethora of ways you can protect yourself as a buyer from being Gazumped. With our open and honest Mortgage Advice in Hull, we may be able to provide the help and support you need.
Here at Hullmoneyman, we strive in providing a fast & friendly service with the goal of getting you through the mortgage process. This is beneficial if you are a buyer looking for a speedier experience through your mortgage journey.
Furthermore, our expert team are able to get a mortgage agreement in principle sorted for you usually within 24 hours of your free mortgage appointment.
Having this AIP with you can demonstrate to the seller that you are in a serious position to proceed and give them the confidence in your getting a mortgage. This can make you stand out from other buyers who may provide a better deal but cannot confirm if they are eligible for a mortgage.
Book your free mortgage appointment today and see how our helpful team can help on your mortgage journey as a First Time Buyer in Hull.
When it comes to divorce or separation, it can be a challenging time. Processing the separation along with arranging finances as well as where you are going to live can slowly build up a lot of stress. Financial commitments should be at the top of your list and may come with some hurdles to overcome.
If there are children involved in these situations, the most common arrangement parents go for is where the children would live with the parent who is more of a stay at home parent. This means that the other parent would move out and there may be a point that whoever is ‘in situ’ wants to carry on the mortgage as a sole applicant. Another option is for both parents to leave the mortgage and begin their own.
Any mortgage commitments you made together could be an element that makes the process a challenging one. If you are finding it difficult to sort this out, you may look at the assistance of a Mortgage Broker in Hull who can provide you with the specialist mortgage advice you need.
Through our time as an expert Mortgage Broker in Hull, our deal encounter with specialist cases on a daily basis. Our experience has provided us with the opportunity to help and guide a large range of customers experiencing a divorce or separation. Below is the top three questions we get asked when people get in touch:
With your mortgage commitments, it can be difficult if you are looking to change these. This is because both of your names are on your mortgage and it’s not as easy as it seems if you are looking to remove your now ex-partner off the contract.
If you do approach a dedicated Mortgage Broker in Hull for advice about removing a name from a mortgage, they need to be certain that the remaining applicant on the is able to and afford their mortgage completely as a sole applicant.
Both of you are required to have a full affordability assessment carried out on both of you even if you have kept p with mortgage payments or not. Sometimes, an applicant has managed to prove that they have been paying the mortgage payments without any help from their ex. However, this will not change the fact that their name is still linked into the deal and you still need to pass the lender’s check.
Around this time in the process, our team often find that people have already sorted out someone who will step in and replace the ex-partner on your mortgage. Normally, the person who steps in is either a family member, a close friend or a new partner altogether.
The way your affordability is assessed varies between lenders as they have their own unique way of carrying it out. With this in mind, don’t lose hope if you existing lender can’t help you out. You might find there is additional options out there for you as a homeowner so it’s always best to seek the help of a Mortgage Broker in Hull.
The good news is that the process works just the same, however, you are trying to move out and take your name off the mortgage. As mentioned, both of your names are still linked to your mortgage which means you are still responsible for any mortgage payments even if you choose to leave.
Regardless of if you have a verbal or written agreement between you both that states that your ex will be the one managing payments, it is not legally binding in the eyes of the lender so you will be deemed responsible.
In the event that you want to take out a mortgage on a new property, in your name, the lender will still take into account the mortgage payments for your old property. Therefore, it’s best you consider this if you are thinking of taking out a new mortgage. This is we always advise getting help from a professional Mortgage Advisor in Hull ahead of time.
We have found that people in these types of situations usually get confused and stressed out. This is where Hullmoneyman can provide a helping hand. Our friendly team can connect you to be of our experienced Mortgage Advisors in Hull who will be able to sort everything out for you. They can also advise you on the most appropriate option available to you as an individual looking at Moving Home in Hull.
You may find that a number of lenders are more generous than others when it comes to the amount they will lend to you. One may be strict and the other may be more lenient with them looking into your current mortgage commitments being a large factor in this during these circumstances. This is something we will take into consideration when recommending the most appropriate lender to apply for a mortgage agreement in principle with:
Depending on a variety of circumstances, many homeowners may have the option to have more than one and even more than two mortgages on different properties. This will involve a lot of things to be assessed from your lender and their credit scoring system if you were looking to apply for a second mortgage.
The overall reason for carrying out these tasks is to determine whether or not you can afford this route. In the circumstance where you are applying for multiple mortgages and are failing, this could negatively impact your credit score.
One of the many benefits of approaching a reputable Mortgage Broker in Hull, like ourselves, is that we are able to carry out a search for you without harming your credit file. As soon as we have keyed in all of your information, we can give you an estimation of the maximum borrowing capacity.
By having this information, you are able to have a rough idea of your budget including the costs of your monthly mortgage payments as well as current financial commitments you may have.
Some individuals find it challenging to move on from their current financial commitment, especially in cases like these. If you are in a similar situation, an expert advisor can provide a helping hand which can provide you with the help you need for the process of removing a name from a mortgage.
The aspect of moving home is already a stressful experience so adding a challenging situation like a divorce or separation can sometimes add some extra weight to the situation. Speak to a Mortgage Advisor in Hull today to see how we can help you.
It’s key that you plan your mortgage journey, it’s that initial step that you should take prior to beginning the process. If you start the process early, there is a chance you are put in front of other buyers. Preparing a mortgage agreement in principle should be at the top of your list before you start viewing properties.
In some cases, you may have planned a mortgage to the last detail but the overall mortgage has not gone to plan. This is common in the circumstance amongst couples who have decided to separate. In this unfortunate situation, you may need to take out a mortgage as a sole applicant with no time to plan.
As an expert Mortgage Broker in Hull, we do recommend that you begin planning your mortgage six months prior to looking to Move House in Hull.
Sometimes, the mortgage process can throw many obstacles which is why planning is important. By preparing for any hurdles you may encounter, you should be able to work out what to do to overcome it.
Through our 20 plus years working in the mortgage industry, we have been exposed to a large variety of mortgage problems. Even in the final stages of the mortgage journey, some occurrences can negatively impact the process, however, they can sometimes be solved if you prepare enough.
Below are some common problems we have found customers encounter towards the end:
By preparing six months prior to starting the mortgage journey, you may be able to avoid some of these problems.
Saving up for a deposit can be a difficult factor when you are aiming to achieve your mortgage goals, particularly for those who are renting. You may find saving a deposit as a timely goal with it often taking years, especially for first time buyers.
For a ‘5% deposit’, saving up can be difficult. This is because you don’t know the exact amount that you need until you find a property that you want to make an offer on. The 5% total differs from property to property.
In the circumstance where you are struggling to reach the initial deposit total, you may be able to get financial support from your family through a gifted deposit. This amount gifted does not have to be the full 5%, it could only be a small portion of it; this additional cash may give you the amount you need to get to the minimum deposit.
Another option is to look into applying for one of the Help to Buy schemes for that deposit boost. This is just one of many schemes available that are designed for applicants needing support with deposits. These are usually popular with many First Time Buyers in Hull as a way to get them on the property ladder. There could be a scheme out there that is perfect for you.
Credit scores are one of the big contributing factors when it comes to applying for a mortgage. If you have a poor credit score, this can lower your chances of getting accepted for a mortgage. Obviously, this all depends on the reasoning behind your low credit score. You may have a poor credit score because of a CCJ or bankruptcy, which can consequently lower your chances of being accepted, depending on how long ago these issues occured.
Check My File is a brilliant website to use if you are wanting an insight into your credit score. By doing this, you will be able to obtain a copy of your credit report which our team will be able to look at free of charge.
When it comes to your mortgage application, it’s important that look at how well you managed your finances. This is because lenders will carry out a thorough analysis of your bank statement and will be able to look at your income and outgoings. Gambling transactions is something that will catch Lender’s eye especially if they are frequent and erratic outgoings. They will gambling with large sums of money unreliable and could turn you away.
In the fortunate case where you are able to receive a gifted deposit, we would suggest that you keep that sum of money in the gifter’s account. By doing this, you will not have a large bank transfer in your account which lenders would question about. Therefore, it’s wise to keep this gifted deposit inside of your family member’s or friend’s account.
If you are a self employed applicant, you may find the mortgage journey a bit more challenging to a regular applicant. You will need to provide a lot more evidence which a usual mortgage applicant would need to.
The evidence you will need to provide as a self employed applicant includes at least one year of accounts’ and three months of bank statements to show your income and affordability. In some cases, you may need to provide additional evidence, however, this just depends on the lender.
Through the mortgage journey, you may come across a range of mortgage hurdles that could stall your purchase completely. One of these include a break in the property chain. A Mortgage Broker in Hull like us will be able to help you overcome these hurdles. We are here to support you 7 days a week.
If you have a specialist or complex case, look at getting Mortgage Advice in Hull. Our team can provide you with a helping hand through your mortgage journey.
A Mortgage Advisor in Hull will need to have a good idea of your financial situation in order to find you the most appropriate mortgage for your circumstance. Having an up to date credit report is something we recommend as a Mortgage Broker in Hull.
We recommend the check my file report agency to our customers as they are able to bring in your data from 4 credit reference agencies to give you in-depth detail into your profile. In some instances, the data held may vary depending on the credit reference agency you are looking at.
Sending your Credit Report by email will differ depending on what device you are using e.g. iPhone, Android, Desktop PC.
As soon as one of your expert Mortgage Advisors in Hull has reviewed your credit report, we will get in touch with you to discuss your mortgage options in-depth.
Using our extensive knowledge as a reputable Mortgage Broker in Hull we will be able to give you in-depth information about the various criteria set out by the lenders we work with. Some of which are specialist lenders, check out our Specialist Mortgage Advice in Hull page to find out more information.
If you are a First Time Buyer in Hull or are looking to Move Home in Hull, our team can recommend the most appropriate mortgage for you by using our experience and knowledge as well as the information shown in your credit report.
Through our 20 plus years in the industry providing open and honest Mortgage Advice in Hull, it’s a known fact that each mortgage lender has their criteria to determine who gets accepted and who doesn’t. You may find that some lenders criteria are difficult to match compared to other, either way, it all comes down to whether or not your can their criteria and the performance of your credit score.
The most common reason a customer’s mortgage application gets declined is not meeting their lenders criteria. This is where we strongly believe that an expert Mortgage Broker in Hull, like ourselves, is very helpful. Here at Hullmoneyman, we search thousands of deals with the goal to find you the most appropriate lender for you and your financial situation.
Prior to applying, you first need to check your credit file to see if it’s looking good. Don’t worry if not, our guide on How to Improve Your Credit Score might help! Making your credit file favourable to the lender can be done in a variety of ways, however, we always suggest you approach a Mortgage Advisor in Hull before anything.
Another reason to seek an advisor is that only a small number of people are realistically eligible for every deal on the market. Therefore, the majority of the time, people are searching for the wrong deals. It’s not all about finding the cheapest deal, it’s finding one that you will qualify for.
As an experienced Mortgage Broker in Hull, we do recommend that you do look into the different types of mortgage available or get Mortgage Advice in Hull before you rush into anything.
Get in touch with one of our knowledgeable Mortgage Advisors in Hull by booking your free mortgage appointment online or call our team.
It’s common for customers to use price comparison websites to find a mortgage. There is no problem with going down this route, however, you need to keep in mind that the price comparison websites can’t match you to all the details of a lenders criteria.
Furthermore, it can take weeks for an application to go through the process and can be time-wasting if it ends up being a declined application. This can result in you losing your property and/or breaking down a chain. You could have been declined due to selecting the wrong mortgage which can leave a negative footprint on your credit score for a failed application.
In some cases, customers could be eligible for particular deals, however, only at a reduced amount that allows them to match the criteria. It can be common for a lender to initially say that you can borrow a certain amount and then in the future, they change their mind and look to reduce the mortgage available.
Again, lenders are all different and have their own ways of carrying things out. You may find there is a significant difference between the ways the lenders work and it’s very unlikely that you are going to match all of them. Therefore, it’s best that you narrow down your options so you can find the best mortgage option for you.
If you are a First Time Buyer in Hull or are looking at Moving Home, we strongly believe that seeking expert Mortgage Advice in Hull will be very beneficial. Here at Hullmoneyman, we will provide a helping hand from the initial point of contact all the way through to getting the keys to your new home. Along with this, we will strive in finding you the perfect mortgage deal for your personal and financial situation.
Through our 20 plus years of experience in the industry, we have dealt with thousands of specialist mortgage cases and have been able to create mortgage success for our customers. Utilising the service of a Mortgage Broker in Hull, like ourselves, will allow you to obtain an up-to-date credit report too and will be provided you with the most suitable mortgage for you!
If you feel your situation is too complicated, a Specialist Mortgage Advisor in Hull could help! Get in touch with our team today for a free mortgage appointment. Check out our fantastic customer reviews to see how a Mortgage Broker in Hull helped them through their mortgage journey!
Stepping into the mortgage world as a First Time Buyer in Hull can be stressful, especially if you don’t have a lot of knowledge and this is a new experience for yourself. However, this doesn’t have to be the case. It’s good to be prepared as possible in order to make the most out of your house buying experience. Below is 9 questions to ask yourself when purchasing a house as a First Time Buyer.
It’s good to have a think about a property you have looked at before you commit to it because a mortgage could be one of the biggest financial commitments in your life.
When it comes to the thinking stage of the process, you need to ask how many people have looked and enquired about the property in order for you to know how long you have to make a final decision. Therefore, if the property is getting a lot of interest, you need to have a final answer pretty soon.
A property chain happens when there are a number of transactions occurring at the same time for every sale and purchase to be completed.
If the property is a part of a chain, this can have a significant effect on parts of the mortgage process.
In the case where there is no onward chain like a new home, bereavement or emigration, can increase the chance of you moving in quickly especially if you are not part of a chain yourself. You can have more of an advantage as a buyer if you don’t need to sell your own property first because you won’t be interrupting the home buying process.
It’s good to utilise this benefit when negotiating property price negotiations.
It can be common in homes that have had previous owners for them leave some previous items behind, which can be a benefit for you. These items include electronic goods like washing machines, fridges, freezers or things like sheds that have been left by for the next occupant. This doesn’t apply to new build properties as they come as standard or agreed upon prior to being built.
The advantage of this is that buyers can save money can time, however, can be an issue for those who don’t want these items as you will have to find a way to dispose of them. In the circumstance where you buying a new build property, there might additional items you can buy that can be fitted and ready on the day you move in.
Another factor you may consider is the neighbours as a good or bad neighbour can lie in the option of you living in the property. This can be beneficial to do if you are looking into an area you have no knowledge or experience of. If you move into a new build, then you and your neighbours will be the ones building a community thus making the experience risky as you won’t know what anyone is like ahead of time.
When it comes to running costs, it all depends on the house and the location which is why it’s helpful that you do your research and ask the right questions. Look into things like how much the Council Tax is as well as the average spend on utilities which can be done by researching online or asking the seller. By knowing these factors, you can help budget for each property.
The direction the house faces can be an important factor to you especially if you like relaxing in the garden in late summer evenings or reading books in natural light. You may find that having a south-facing garden comes with a large premium price to pay because you will receive the most sun throughout the day.
This is another factor you need to think about as it can have a significant impact on your budget. With this in mind, below are some things you may want to look into.
The house buying process usually kick starts with negotiating on a property price. It’s best that you are as ready as you can be to make an offer on a property that you like. If you are wanting to build your skills on this, check out our How to Make an Offer article. As soon as you are prepared, you can then begin negotiating.
To determine if your offer is too high or too low, it’s best to have a chat with the seller of the home or estate agent. From this, you can find out any other offers that have been made and rejected before your offer.
Having a date set in the diary can allow you to plan the other tasks you need to do in advance. These tasks could include instructing a conveyancing solicitor, packing your belongings and sorting out a removal van to bring your belongings to the new property.
In some cases, a practical way to get on the property ladder as a first time buyer in Hull or home mover in Hull could be buying a home with a friend or partner. The deposit can be raised quicker and bigger than it would be from a single income, also the costs will be shared. It’s important to remember that if one defaults, the other could be responsible for the full mortgage. Therefore, here are some points to look out for from our mortgage broker in Hull.
The maximum amount of people that can jointly co-own a property is four. When you jointly co-own a property, you have a legal right to stay in your home unless a court rules otherwise. Furthermore, if a person would like to sell or take out extra borrowing against the property this is something all owners will have to consent to. Unless a court order state otherwise.
Civil partnerships or married couples usually prefer joint tenancies. In a case where one of the joint tenants dies, then the property immediately is passed to the other owner. The law sees joint tenants as one unit which means you can’t remortgage or sell the property without the agreement of the other owner.
Relatives or friends who are buying together tend to go for tenants. You may jointly own the property but you do not have to own equal shares. Therefore, you can act individually meaning that you have the right to sell or give away your share of the property. There is a way you can mortgage your share of the property, but it would be difficult to find a lender that will lend in these circumstances.
All borrowers are jointly and severally liable, which is something a mortgage lender will highlight to you. If a situation occurs where one of you stops paying your share of the mortgage, then the other(s) will make up the shortfall and pay the full amount.
Buying a mortgage is a big financial commitment, therefore, you should commit to this with the intention of not splitting up in the future. In the circumstance that this does happen, you would have to make changes to the mortgage which can be a difficult situation.
In the case that children are involved in the situation, one person will be occupying the home, however, there might be a point where the person would want to take over the mortgage in their own right therefore will need Mortgage Advice in Hull.
Regardless if one of the parties in the joint mortgage is paying the mortgage without any help from their ex, the application was still processed in joint names. Therefore, in the event of mortgage arrears, both parties are accountable even if only one person is trying to upkeep payments.
The lenders will have to be confident that the applicant remaining can keep up the payments on their own from then before removing a party from a mortgage. To determine this, the lender will need to carry out a full assessment of income even if you have been consistent with your mortgage payments in the past.
Its common in these situations that the individual who steps in to replace the ex-partner is usually a family member or a new partner. When it comes to this change, a Mortgage Advisor can help you go through this process.
In the case of a separation or divorce, it’s key that you know that all parties remain responsible for any joint financial commitments. If a person leaves the family home, this still applies as well as if an agreement is made between both parties that one person will be responsible for all the payments.
If you are looking to purchase a new property in the future, the mortgage payments on the previous property will be accounted for. That’s why it’s important that a person gets Mortgage Advice in Hull prior to making an offer. Many lenders are more generous when it comes to the amount they will lend in comparison to others. Our Mortgage Advisors in Hull will take this into consideration when recommending the most appropriate lender to apply for a Mortgage Agreement in Principle with.
When it comes to moving home in Hull, one of the reasons people look for when searching for their dream property is the location. To help with deciding where you are happy to be in your new home, we have compiled a list of the top ten factors that could help.
It’s best to establish where you would prefer to live because the property you are wanting might be the place you settle down and start a new life in. Your preferences could include the bustling ‘big city’ atmosphere. Alternatively, you may thrive more in a quiet, scenic, and rural landscape. There are both pros and cons to each option and is something that is down to your personal preference.
Factors you should consider when deciding on a location are your transport links. Make sure the location fits in well with your regular commutes to work and with what you like to do in your free time e.g., shopping in the city center or enjoying time in a rural area. Either way, it’s good to know what type of transport links are available to you as well as the costs of these links.
In the circumstance where you have children or you plan to have some in the future, the schools in the area may be something to look at. Therefore, you may want to research which schools are within the catchment area of the property as well as having an idea of what the schools are like.
This can be done by looking online at the school league tables, which can provide you with more information to help you find which school is the best option for your area.
Thinking about if the location fits well with the facilities you need or desire is a factor you may want to consider. It’s helpful, however, it’s good to determine which factors are must-haves and which ones are more of a preference as this will help you with deciding if the location is best on a practical level. For example, the location may not have a gym which you could prefer but has a shop within walking distance.
Many people prefer having a shop on their route home from work and some prefer to have a gym on their route home from work. When it comes to families, some prefer having a park nearby for the kids.
For some, having friends and family within a short distance of them can be important. Many prefer this as they can rest assured someone is there to support them when there in need. On the other hand, this may not be a priority for you, or you prefer peace and quiet instead of socialising regularly.
Finding that property that is “good value for money” can be dependent on which area you’re looking at. If you’re looking to find a property, and you want to get the most out of your money, then it might be best for you to find somewhere that is a little cheaper. In this case, you may need to dismiss some of those factors you desired.
Your experience of living in the house can be affected by the local community. The type of neighbourhood you might prefer could be small and close-knit, therefore, have a word with the estate agent or research yourself what the community is like there.
It’s common that areas have a community Facebook group or a dedicated local website. If you are looking at living in a more quiet area and community is a factor that isn’t important to you, maybe use your time to look into the reputation of the area.
A new job or career can be the reason that you change location. Therefore, it’s probably good to think about how far the is from where the property is where you want to buy. In cases where you’re job hunting after your home move, it’s best to do some research before as to what sort of work there is in the local area and who the main employers may be.
In terms of property types, there a lots available on the market for home buyers. You may prefer a property that is an end-terrace with a beautiful garden or you may want a super modern, inner-city apartment, therefore, make sure to look at a range of different options that are available to you and see what property is appropriate for you.
Proposed investment within the local area can be beneficial to know if you’re looking for a property to settle down in for a while. Looking online can help you find out if there are any future investments in the local area, as well as helping with deciding if this is the best location for you. Consider if any of these investments will benefit you and the lifestyle you are looking at. For example, if you are looking for a quiet life in a rural area, a new housing development nearby may ruin your ideal housing scenario.
Firstly, let’s rewind to what happened leading up to the 2007/08 “Credit Crunch” to get an insight. In the 1970s and ’80s, a first time buyer in Hull would probably go through a building society if they were wanting to take out a mortgage to purchase a home.
Back then, it was the norm to make an appointment with the building society manager to see whether or not you qualified for a mortgage. This was at the time where banks didn’t always do mortgages! The process would involve the customer taking out a savings account with the building society and the building society would then use that money to lend to other customers. For the building society to make a profit, the interest rates would be higher to borrowers than the rate they were paying to savers.
They moved away from the older model when the banks got involved in mortgage lending. The new strategy would be where lenders would “buy” the money from markets. This would speed up the process in which they could lend out to customers.
Jumping to the mid 2000s; The market was full of new specialist lenders, with many of them originating from North America.
Known as ‘securitisation’, the lenders would sell their book of mortgage customers to raise new money and lend again. Usually, the books were bought by investors from larger financial institutions such as pension funds and high street banks.
Due to the greater deal of money made from the market, new lenders saw this as an opportunity to introduce more relaxed and flexible lending criteria. The lender saw poor credit history and self-certify mortgages as no issue, though it soon became apparent that it was just that; an issue.
Due to the relaxed lending criteria that lenders introduced, these mortgages, obviously, began to default. This lead to major banks losing confidence in each other, because of the uncertainty of how exposed they were in the fast unraveling sub-prime mortgage market.
The banks’ share prices plummeted in no time. Some, however, were bailed out by the UK Government (or more accurately, the taxpayer) to prevent them from going bust. Unfortunately, not all were bailed out and failed.
Because of “The Great Recession”, almost 80 different banks, building societies, and lenders across 20 different countries filed for bankruptcy or were acquired. Once this happened, lending dried up quickly.
It took nearly a decade for the market to recover safely. Property prices significantly dropped and everyone lost confidence in the UK economy.
This event is one that we don’t want to happen again. To prevent this, The UK government carried out investigations into what went wrong. This led to the “Mortgage Market Review 2014”.
With self-cert mortgages banned, responsibility for the affordability of mortgages was now in the hands of the lender.
There were in-depth investigations into customers’ incomes and outgoings with more precise lending criteria. Credit commitments, childcare, and other outgoings were now something lenders were paying more attention to. From this, lenders would be able to ensure customers could consistently afford their mortgage repayments.
Getting a mortgage is a lot tougher now than it was before. To prove their finances get taken seriously, customers need to be more organised with paperwork. Many mistakes happened running up to the Credit Crunch, however, the industry has learned a lesson to hopefully minimise the chances of this ever happening again.
Remortgaging in Hull could be the next step for you if you have decided to stay in your current property and not move house. It is a way for you to stay in your current property with more favorable interest rates and works by being transferred from your existing deal to a better deal. As an experienced remortgage broker in Hull, this is something our team of mortgage advisors can help with.
The banks count on their customers not being as knowledgeable and shopping around for a better deal. Often, you will find there are cheaper offers for you elsewhere. Ways to find them could be speaking with a knowledgeable mortgage advisor in Hull who can assist with comparing deals or you can seek these out yourself through a price comparison site. From this, you will find there is probably a deal appropriate for you. However, price comparison sites mainly look for your best deal on an interest basis.
Providing that you’ve been on your current mortgage deal for some time, there is a possibility that you could be on a low Bank of England tracker deal. You could even be paying less than 1% so, it may be best for you to stay with that mortgage deal. This could become an issue if the base rate eventually rises as well as your payments.
Yes, there is a chance providing that you pass the affordability checks and assuming there is a good amount of equity in your property. From this, you may be able to increase your mortgage to fund future home improvements.
It can be a very wise option because it gives you an updated home and the chance to increase the value of your property if done carefully and with the right help. We find this can help customers in the process of updating their kitchen, converting a loft, or creating a home office.
As well as home improvements, you can borrow extra funds for most legal purposes, this could include:
Adding debt to your mortgage might not be the best idea. If this happens, you will end up paying back more interest overall through extending the term of your debts to make the payments lower.
Another risk of this is that you are taking debt, which is not secured and, securing it on your home. It could create the potential risk of having your home repossessed. Something that will likely be a problem would be consolidating debts that you can afford or credit cards that are 0% interest.
It’s important to know that you need to speak to a qualified mortgage advisor prior to securing any debts against your home.
An option you could take is to reduce your monthly outgoings to avoid missed payments. By doing this, you are decreasing the risk of your credit rating being in a bad state.
A “Product Transfer” or “Retention” product, is one option a lender will offer. This method allows the lender to provide you with a new deal to stay with them. You would need to contact your provider directly to see what is available to you, however, this option isn’t guaranteed.
In some cases, lenders will allow you to make a product switch online without providing further information or advice.
Staying with the same provider and switch products might be an easier option, however, putting a new application to a different lender may save you a lot of money.
You will find that many banks would offer favourable rates to new borrowers over existing ones. They will be a time where lenders will take a more ethical approach that could have a positive change on customer loyalty.