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Shared Ownership – What is it? How does it work?

Shared Ownership Mortgage Advice in Doncaster

The Pro’s and Con’s of Shared Ownership Mortgages | MoneymanTV

What is shared ownership?

Help to Buy Shared Ownership is a government scheme that helps First Time Buyers in Doncaster and Home Movers purchase a percentage of your home (usually from 10% to 75% of the home’s value), and pay rent on the remaining share. Later on, you can buy more significant shares when you can afford to do so.

If eligible for this scheme, partial homeownership is an excellent way for First Time Buyers in Doncaster to get onto the property ladder and a way of owning your home without the need for a heavy deposit upfront. 

How does the scheme work?

Firstly, a deposit needs to be put down on the property. The minimum deposit that you need to put down can vary. For example, the percentage can change for better or worse depending on how good your credit score and financial situation is.

This scheme will still require you to take out a mortgage, but only on the percentage that you’re buying. For example, if you plan to buy 40% on a property worth £170,000, you’ll only need to take out a £68,000 mortgage.

Furthermore, rather than providing a deposit based on the full house price, you only have to put down a deposit based on the mortgage you have taken out. So, in this example, a 5% deposit would be £8,500.

You will start paying off your mortgage once the offer you put down gets accepted and you have moved in the property. As mentioned before, you will also have to pay rent on the remaining share of the property.

Despite having two sets of payments, your overall monthly costs should not be as expensive as taking out a ‘regular’ mortgage.

Costs and fees

When taking out a mortgage, you will need to consider lots of different costs. Shared Ownership mortgages will likely come with set-up/arrangement charges, booking and solicitor fees. Make sure to double-check that you are aware of these additional costs.

Of course, the costs can vary depending on the property that you are buying. As well as the deposit size, monthly payments, arrangement fees can differ from property to property.

How can I apply?

To make sure you are eligible to qualify for the Help to Buy Shared Ownership Scheme, here are the requirements:

  • You have to be at least 18 years of age.
  • Living outside of London, your total household annual income must be less than £80,000.
  • You must be a First Time Buyer in Doncaster or in the process of selling your current property. You cannot own another property.
  • If you can afford to purchase a property on the open market, you will not access this scheme. 
  • You must prove that you are not in any arrears, such as mortgages and rent.
  • You must provide evidence supporting a good, clean credit history—having a CCJ on your credit file or any other credit-related issues will look bad. 

Although this may appear like a lot, it’s the same as most Help to Buy Schemes. Each schemes’ differ from the other, as they are targeting applicants in different situations.

If you have credit problems, you may need to look at other ways to get a mortgage. There are lots of different government mortgage schemes out there that could help you get a mortgage.

For more information on these schemes, feel free to navigate to our website’s Help to Buy Mortgage Advice service page.

Get in touch with a Mortgage Broker in Doncaster today

Our mortgage advisors in Doncaster have helped many buyers secure a mortgage through the Shared Ownership scheme. We have been helping First Time Buyers for over 20 years now!

If you are looking for Help to Buy Mortgage Advice in Doncaster, we can check whether you match any schemes’ requirements.

Please take advantage of our free mortgage consultation by booking yourself in for a mortgage appointment today.

The Different Types of Mortgages Explained

Mortgage Advice in Doncaster

Whether you are a first time buyer in Doncaster looking to buy a property, moving house, or are ready to remortgage, you’ll soon begin to realise there are many options out there for you when it comes to taking out your mortgage.

This article will feature a comprehensive list of the most popular mortgages available to customers currently on the mortgage market.

If you have any questions regarding any of the mortgage options below, please do not hesitate to get in touch. You can now book yourself in for a free mortgage appointment to speak with a dedicated mortgage advisor in Doncaster, at a time that suits you and your lifestyle.

What is a fixed rate Mortgage?

What Is A Fixed-Rate Mortgage?

A fixed-rate mortgage will mean that your monthly mortgage payments will stay the same for the duration of your mortgage term.

The length you want to fix your payments is your choice, with typical options being around 2, 3 or 5 years or longer.

No matter what happens to inflation, interest rates or the nationwide economy, you know that your mortgage payment, which is usually your single biggest outgoing, will not change.

What is a tracker mortgage?

What Is A Tracker Mortgage?

A tracker mortgage will provide you with an interest rate that mimics the Bank of England’s base rate.

That means neither you nor the mortgage lender will set the rate and change as and when the base rate does.

You will be paying back at a percentage that is above the Bank of England base rate. If we use this in an example, the base rate is 1%, and you are tracking at 1% above the base rate, which means you will be paying back your interest rate of 2%.

Even though these deals aren’t as popular anymore, consider that your mortgage payments will increase if the base rate increases. If it goes down, yours will go down too. Of course, this will benefit you.

What is a repayment mortgage?

What Is A Repayment Mortgage?

When you take out a repayment mortgage, you will be paying back a combination of both the interest and capital each month.

Going off the basis that you can keep your payments going for the mortgage term duration, you will be guaranteed to have paid it off in full and own the home of your dreams by the end of it.

That said, this is generally considered the most risk-free way to pay your capital back to the mortgage lender across the industry. Early in your term, the amount you’ll be paying will be mostly the interest, with your balance reducing at a slower rate, especially if your period is 25, 30 or 35-years.

The process quickens up within the last ten years or so of your mortgage, where you will be paying back more capital than interest, with the balance reducing at a far quicker rate.

What is an interest only mortgage?

What Is A Interest Only Mortgage?

While we do still regularly encounter many buy to let mortgages being set up on an interest-only basis (this is an option that works out much better for many landlords), it is increasingly difficult to get a residential property on an interest-only basis mortgage.

The reason for this is because once you reach the end of your term, you will still have the entire mortgage amount to pay off all in one go, with no additional income to fund the amount you’re required to pay.

There are various unique circumstances where this can be a suitable option for customers, including downsizing when you are older or if you happen to have other investments you can use to pay back the capital.

Lenders are often stringent when offering these products now, and the loan to values tend to be much lower than they were in previous years.

What is an Offset Mortgage?

What Is An Offset Mortgage?

The way an offset mortgage works is that your mortgage lender will set you up with a savings account that will work in tandem with your mortgage account.

For example, let’s say that you have a mortgage balance of £100,000 and you deposit £20,000 into your savings account, you will only be paying interest on the difference between those figures, which would work out at £80,000.

This can be a very efficient way of managing your finances, especially if you want to be paying higher rates of tax.

What is a capped rate mortgage?

What Is A Capped Rate Mortgage?

Like fixed-rate mortgages, capped rates have a maximum amount that a customer will pay each month with a maximum interest rate. With that in mind, if you’re capped at, say, 5%, you’ll never go higher than 5%.

These can be more beneficial if interest rates start to drop, so, for example, if the rates drop to 4%, 3% or 2%, then your mortgage will do the same.

What is a flexible mortgage?

What Is A Flexible Mortgage?

Flexible mortgages allow you to underpay and overpay by unlimited amounts. Underpayments are only allowed if you’ve overpaid first and have agreed with a lender to do so.

Overpayments can be reasonably beneficial, though, as you could end up paying off the mortgage early and with significantly less interest. Mortgage flexibility is usually a feature of offset mortgages.

Mortgage Broker in Doncaster

Armed Forces Help to Buy Scheme in Doncaster

Forces Help to Buy Mortgage Advice in Doncaster

Some really great news for any personnel of the military, as according to Army Families Federation Defence Secretary Ben Wallace the current Help to Buy scheme that was created as a means to help military personnel get onto the property ladder has been extended.

It was originally introduced back in 2014, with a huge £200 million put into the scheme. The intention was to provide a boost to anyone from the forces who needed some help in purchasing a home. The project was supposed to be brought to an end in December 2019.

To show their gratitude for the military’s commitment to their Queen and country, our government chose to extend this scheme further, choosing instead to bring it to an end in December 2022.

Who Can Apply For Forces Help To Buy Scheme?

Anyone who has served some time in the military may be able to access the scheme and borrow a deposit of up to half their annual salary (a maximum of £25,000), free of any interest.

Of course you do have to be eligible, with this all depending on the length of the term served, how much you have left to serve and medical categories.

The Armed Forces Help to Buy Scheme can be used to either purchase their first home purchase or to move into a new home if you already own one.

Whether you previously thought you could or not, you now have a home buying lifeline if you are indeed eligible for it.

One of the best parts about this mortgage scheme, that is appealing to many home buyers, is that you don’t actually need any current savings in order to find your footing on the property ladder.

The funds will be raised from the loan that you receive via the Armed Forces Help to Buy Scheme and can be used to put towards your deposit as well as any other costs, including but not limited to;

  • Stamp duty
  • Estate agent fees
  • Solicitors fees

This scheme is a lot more relaxed than some other schemes available, and the Forces Help to Buy loan can be paid back over a duration of around 10 years, so you have no reason to feel rushed about paying it back.

For more information on this scheme from the government, click here.

How a mortgage advisor in Doncaster may be able to help

As an experienced mortgage advice team in Doncaster, we will have your back from the first time you call up, right through until competition and even beyond that.

Your dedicated advisor will take care of you all throughout your mortgage journey, ensuring that you end up with the most appropriate mortgage result for your personal and financial circumstances.

We truly do pride ourselves on being able to provide a fast and friendly customer experience that is free of stress and worry. Get in touch with us today and we will see how we are able to further you and your home owning dreams.

It is important to remember that the Forces Help to Buy is not the same as the typical UK Help to Buy scheme.

What is a Tracker Mortgage?

Tracker Mortgage Advice in Doncaster

If you have done your research prior to getting in touch with an open and honest mortgage broker in Doncaster, you may have come to realise there are a lot of different mortgage types available to first-time buyers, all varying on the circumstances they are appropriate for and who is eligible.

Throughout this article, we are going to take a more in-depth look at the tracker mortgage, how it could benefit you and your mortgage situation, as well as why it is a popular choice amongst homebuyers.

First of all, please remember that a mortgage deal is only as good as the circumstances it matches up with, so though it may seem good on the surface, it may be the wrong path to take entirely.

To give out an example of what we mean here; Initially you could take out a tracker mortgage, only for you to later decide that fixed payments would’ve been your preferred option (via a fixed-rate mortgage). Once you’re at this point, you have already locked yourself into a contracted agreement and making changes wouldn’t be an option.

As a reputable, experienced and hardworking mortgage broker in Doncaster, we will always recommend that you get yourself prepared and making sure you are well researched prior to your mortgage journey getting underway.

We feel like home buyers would truly benefit greatly from taking up expert first time buyer mortgage advice in Doncaster.

As an alternative to our article, we also have a YouTube video on the same topic readily available for people to watch. Feel free to head on over to our moneymanTV channel to view more helpful video guides, presented for free by the ‘Moneyman’ himself, Malcolm Davidson.

What is a Tracker Mortgage? | MoneymanTV

What is a tracker mortgage?

Well, now let’s get down to business. I’m sure the first thing you want to know is; What is a tracker mortgage?

So if you were to find yourself on a tracker mortgage, your interest rate would move along with the Bank of England’s base rate and typically with an additional percentage added on top by your mortgage lender.

Your lender cannot choose the rate, as this is usually an externally set rate and will have to be followed strictly.

An example of this would be if the Bank of England’s base rate was running at 1%, your lender would have to add on another set amount, let’s say 1%.

This means that regardless of what the Bank of England’s rate percentage is, your interest rate will always remain just above that figure.

Will a tracker mortgage in Doncaster benefit me?

A tracker mortgage can be incredibly useful if the Bank of England’s rate is running at a slightly lower rate. It will generally sit around 0-1%, though as the year goes on it will naturally go up a little bit.

Previously, during the credit crunch in 2007-2008, the market plummeted and interest rates went sky high. At it’s highest, it was sitting around 5%.

Of course when adding on the percentage that your lender would add on top of this figure, you could’ve ended up with a rather sizable 6% interest on your monthly mortgage repayments.

On the other side of the coin, looking back to March 2020 (around the start of the coronavirus), the mortgage market had a similar scare when the Bank of England’s rate dropped significantly, dropping a down to an incredibly low 0.1%.

If you were on a tracker mortgage during this period of history, the chances are that you would’ve also dropped down to an interest rate of somewhere around 1.1%.

Naturally because of this, a lot of lenders simply stopped offering this mortgage type to their customers, as really it would’ve been too good to be true. A mortgage lender is still a business at the end of the day and need to turn a profit.

Nowadays the market seems to be almost back in full swing and customers do have better chances now of obtaining a tracker mortgage than they would’ve before, especially one that will be well suited to your financial circumstances.

A tracker mortgage does have both it’s ups and downs, as it will rely pretty massively on the economy. If anything happens to the market and the Bank of England’s rate goes high once again, a tracker mortgage is definitely not the sort of mortgage to go for.

On the flip side of that argument, if the situation is that the economy is doing extraordinarily well with a low Bank of England base rate, a tracker mortgage is one we could definitely look at for you, as you may benefit well from it. Again though, this also depends on what you’re looking to do.

Different Types of Mortgages in Doncaster

There are a wide variety of mortgages types available out there for prospective first time buyers in Doncaster and existing homeowners alike, it’s just finding the one that is right for your personal and financial needs.

Before taking the big leap into any mortgage deals, we would definitely suggest that you speak to a trusted mortgage advisor in Doncaster about what paths are open for you to walk. They will try and find you the best deal they can.

If you are a first time buyer in Doncaster, we believe you’ll benefit immensely from our dedicated mortgage advice service. We have over two decades of experience in the mortgage world and have expert knowledge on various mortgage lender criteria.

We are also available to speak with and provide assistance to any customers looking to remortgage or move home in Doncaster. We hope you will find our mortgage advice service invaluable.

As your hardworking and responsive mortgage advisors in Doncaster, we will work alongside you from beginning until end, offering you mortgage guidance and support all throughout your journey.

Agreement in Principle | Mortgage Advice in Doncaster

What is a Soft Credit Search for a Mortgage?

What is an Agreement in Principle?

There seems to be a rise in awareness of credit scoring from first time buyers and other consumers. This is from the increasing attention credit rating is getting from the general public. Our team has also found that when people get in touch with us, the majority have already viewed their credit reports online.

Experian or Equifax seems to be the two most common credit reference agencies but there are more out there. Check My File is something we do recommend to new clients. When they sign up, they get a 30 day free trial and after the 30 days will then be £14.99 a month, however, this can be canceled anytime. The color-coded report provides an easy-to-follow document that collates a range of information.   

We find that clients have become more aware of the fact that too many credit searches can negatively impact their credit score. Therefore, our clients often ask if our mortgage advisors in Doncaster will do a credit search on them. Even though lenders always carry out credit checks, your dedicated advisor will require the client’s permission before doing any checks.

Banks provide two types of credit searches; hard search or soft search.

What is a Hard credit search?

A hard credit search is when they take an in-depth look at your credit report and any financial institution carrying it out soon as you permit the financial institution to do so. The advantage of a hard credit search would be that the lender is looking into your situation quite carefully and if you pass the credit score, you increase your mortgage application’s chance of success.

As long as you have provided satisfactory documentation to back up the information you have disclosed and you haven’t provided false details, the search can be a success.

The footprint doesn’t state if your application was successful or not, however, if you have carried out a number of searches over a few weeks, this could cause the lenders’ system to decline.

Another benefit is that your credit file will have a record kept stating that you have carried out a hard credit search which is good when someone needs to look at your report. However, a credit file that states that there have been multiple searches carried out in a short period of time isn’t great because it could looks like you have applied for a vast amount of credit at the same time. 

Having the odd hard footprint on your record isn’t bad. That’s why you shouldn’t worry too much about it, it’s just best to be cautious in having too much.

What is a Soft credit search?

Unlike hard searches, a soft credit search provides a ‘lighter’ look at your financial situation. This type of search would normally be used on price comparison websites to provide which options you have or it could be used as a source to verify your identity. You may find some mortgage lenders carry out soft searches and it seems that more lenders are changing to this type of search.

With soft searches, you don’t get offered as much information as you would if someone carried out a hard search. A soft search wouldn’t leave any impact on your credit file if you fail. A lender will obtain less information compared to if they carried out a hard credit search. If you come out with an agreement in principle, the difference between the two doesn’t matter. 

One factor that is helpful is that even though you would be able to see soft searches that got carried out on you, these searches are not visible to other financial institutions like banks. Therefore, you can apply for an agreement in principle without damaging your credit score regardless of if it is successful or not.

In the case where you are wanting to make an offer on a property, our mortgage advisors would suggest having an agreement in principle in place prior to you contact the estate agent. You should give yourself the chance to get the property you want at the lowest possible price. 

A big advantage you can have on your part is if you have demonstrated that you have finances in the right place. Having an agreement in principle can also deter the agent from attempting to ‘cross sell’ their in-house mortgage services to you. 

Do Gambling Transactions Look Bad on My Bank Statements?

Why does the lender need my bank statements? 

No matter the mortgage route that you end up taking, you could be a first time buyer in Doncaster, home mover or looking to remortgage, your mortgage lender will always request a copy of your bank statements. In fact, they will ask for numerous pieces of evidence to support your affordability for a mortgage.

Lenders look at bank statements for multiple different reasons. They will need to measure your mortgage affordability, reliability and determine whether you are someone who manages their finances responsibly.

The planning stage of your mortgage journey matters the most. As a mortgage broker in Doncaster, we would strongly advise that you think about your bank statements and consider what you want to show on them in the months leading up to your mortgage application.

Furthermore, when it comes to what a lender is looking for on your bank statements, a big thing that will catch their eye is gambling transactions.

What has it got to do with the lender whether l gamble or not?

Although gambling is not illegal, lenders do seem to judge your mortgage application less favourably if they can see large amounts of gambling transactions on your bank statements.

There’s a big difference between spending a little bit here and there when the grand national is on to frequently betting lots of money every weekend. This is why, especially during your mortgage application and the months leading up to it, you should remember to ‘gamble responsibly’.

A mortgage broker in Doncaster like us, nor a lender can ever tell you how to live your life, all we can do is ask for you to be careful. Lenders do have a duty to lend responsibly. 

Lenders need to prove to regulators that they’re lending to responsible applicants, therefore they will never lend to someone who can’t take care of their own finances. Would you lend to someone who is constantly gambling over an applicant who hardly gambles?

Will gambling affect my chances of getting a mortgage?  

The odd gambling transaction here and there shouldn’t affect your ability to get a mortgage. Lenders will look at the size of the transactions and how frequent they are.

They will also look at how these transactions affect your overall account balance. Do they make you dip into your overdraft? Are you borrowing money to gamble/gambling money that you don’t have?

If you’re acting irresponsibly with your money in the lead up to your mortgage application, the lender will notice all of these transactions straight away.

What will lenders be looking for on my bank statements? 

It’s not just gambling transactions that lenders will look for, they will also be looking for different things on your bank statements:

  • Loan repayments
  • Exceeding into your overdraft
  • Other current accounts
  • Credit cards
  • Recurring payments

They need to be sure that you are the type of applicant that they want to lend to. From monitoring your accounts to asking you questions about your transactions, they need to be certain that they can trust you.

On the other hand, if you do happen to dip into your overdraft now and again, it shouldn’t have too much detrimental effect on your mortgage application. It’s when you are constantly dipping into your overdraft and are struggling to get out of it.

What can I do to show the lender I am reliable? 

Being reliable and sensible is exactly what a lender is looking for. Plan ahead, show the lender that you’re serious about the mortgage process and want to present yourself the best that you can.

Usually, you will be asked to provide up to three months of your most recent bank statements. With this in mind, during these months, make sure that you take care of finances and be responsible and sensible.

If you gamble regularly, perhaps it could be an idea to take a break for a little while. Betting apps often hold betting limit features; this could be something to think about. As well as aiding your mortgage application, this may also be good for your mental health. 

Get in touch with a mortgage broker in Doncaster 

Our job as a mortgage broker in Doncaster is to help you through your whole mortgage process, from the very start! We will take a look at your evidential documents with you, making sure that you are presenting yourself in the best way possible for your situation.

Our mortgage advisors in Doncaster will hold your hand throughout your application. We have availability 7 days a week, so don’t hesitate to get in touch.

What do Lenders Look for When Assessing my Bank Statements in Doncaster?

What Do Lenders Look For On My Bank Statements?MoneymanTV

Why does the lender need my bank statements?

Your mortgage lender will want to see your bank statements to use as evidence to help them assess how much you can borrow if anything at all.

The lender will look at your bank statements to confirm your income and regular monthly outgoings. In order to view how your financial commitments will affect your ability to repay your monthly mortgage payments.

After all, a mortgage is one of the most significant financial commitments you will ever make in your life. This is why a lender needs to know that you can handle your finances and be responsible. 

How do I obtain my bank statements? 

There are different ways you can obtain your bank statement, such as receiving your bank statement through the post from your bank or going into your local branch and getting it over the counter. It’s common to see that people will retrieve a printable version from their online banking application.

What will lenders be looking for on my bank statement? 

Again, a lender needs to know you are responsible and reliable with your income. They will consider some factors. For example, using an overdraft occasionally is not necessarily a bad thing. However, exceeding your limit quite often is going to affect the lender’s trust in you.

Additional factors a lender will look out for are potential returned Direct Debits, which can indicate you are not reliable, especially if you don’t disclose any loans during the application stage. 

Another factor that you need to be aware of missing any payments for personal loans and things such as credit cards. It’s more likely that a lender will lend an amount closer to what you would like to borrow if you can meet your monthly payment deadlines. 

Will gambling affect my chances of getting a mortgage? 

For some, customers end up stuck due to a history of gambling behind them. Gambling now and again is relatively harmless but constantly throwing large amounts of money. The lender will look at your case less than favourably. Regardless if you are making your money back or more.

for more information, read our ‘Do Gambling Transactions Look Bad on my Bank Statements?‘ article.

What can I do to show the lender I am reliable? 

Various first time buyers in Doncaster and home movers in Doncaster have found that most lenders prefer to have at least three months bank statements from a mortgage applicant. Maybe, it’s time to change your lifestyle to have at the very least three months to improve your handling of finances. 

Firstly, we recommend taking a very long break from the bookmakers and/or online gambling scene. This will benefit you mentally and give your finances some breathing space. 

Secondly, do your best to pay off any current debts you have without using an additional credit card. Even the more minor things like reducing unnecessary purchases can help free up the extra cash to ensure you can pay all your bills on time.

Thirdly, for you to be more sensible, create a plan for yourself with plenty of time ahead of what you’re looking to achieve. The further away you go from debt and financial troubles, the better your chances with a lender.

Speak to a Dedicated Mortgage Advisor in Doncaster

If you’re a first time buyer, moving home, or self-employed, it’s always essential to keep your finances on track. Getting in touch for specialist mortgage advice in Doncaster can help you if you’re feeling unsure when it comes to bad credit history. We are here to further your mortgage journey by advising the best we can.

Plan Ahead to get a Mortgage in Doncaster

Once you have saved up a large enough sum of your income to put forward as your deposit, it is now time for you to get prepared for a mortgage!

We have put together a comprehensive list of some helpful, beneficial advice that will hopefully ensure you’re as mortgage ready as you possibly can be!

Up-to-Date Credit Report

The first thing you should always have at the top of your list of things to do, is getting yourself an up-to-date credit report.

This is something that you should even do before you get in touch with a dedicated mortgage broker in Doncaster like ourselves for mortgage advice, as this will help make the process easier for you.

It is definitely a good idea to pay off any payments that you still have outstanding on your balance, even if you are holding back based on principle. We do sometimes hear of customers refusing to pay phone bills whilst in a dispute with the provider and it’s not something we recommend!

In doing this, you’ll have less going against you and can increase the likelihood of being able to obtain a mortgage. A helpful tip to remember is to make sure you’re on the voters roll, as that apparently has a positive effect on your credit score. Closing down any of your old credit cards also can be helpful.

Your dedicated mortgage advisor in Doncaster will be able to run through your credit report in the early stages of your mortgage journey, providing expert mortgage advice on what you can do to present your credit in the best light.

Proof of Identification

In the beginning stages of your home buying process, you will be asked to present some photo ID. Our customers usually prefer to put forward a driving license or passport to help with this.

Your driving license is something that you can also utilise for your address as well, though if you use it for proof of address, you can’t use it for proof of ID as you must have one for each, not one for both.

Any non-UK nationals who are now living within the UK will need to show us a copy of their Visa on top of this.

Proof of Address

On top of proving your identity, you will also need some documents that can prove where your residence is. Generally speaking we find that regarding these, customers opt to use a utility bill or original bank statement that has a date of the last 3 months.

Alternatively, as mentioned above, if you choose to use a passport for photo ID, you can use your driving license as proof of address alongside it.

Last 3 Months’ Bank Statements

Your bank statements will be used as a means of evidencing your income and regular spending habits. If you’re a frequent gambler, we highly suggest avoiding gambling well in advance, as lenders do not like to see this on bank statements.

The same will apply in regards to going past overdraft limits and letting direct debits bounce. You must ensure you are as prepared as possible in order to present yourself as appealing to a mortgage lender.

Most lenders will want to take a look at your bank statements, as they like to go into the mortgage lending process with complete confidence that you are serious about your finances.

The bank statements usually needed are the ones that show your salary going in, and your bills and regular payments going out.

Evidence of Deposit

You will have to prove that you definitely have the funds in place to put forward for a deposit and be able to evidence this for the purposes of anti-money laundering.

We always feel that the best practice in this case, is to limit moving money around your accounts, as otherwise the audit trail can be a little more complicated.

Lenders have a preference of seeing your savings built up over time, so you’ll need to account for any large amounts that have been transferred into your accounts within any recent period of time.

Nowadays, we find that the deposits being put forward for properties are often gifted by family members. These are an increasingly popular way forward for first time buyers in Doncaster looking to find their footing on the property ladder.

These need to be evidenced also, with the person who has gifted you the money being required to sign a letter confirming it is purely a gift and not a loan that you are expected to pay back at a later date.

Proof of Income

The most important thing when it comes to affordability is proving your income. This is often your last 3 months of payslips if you’re employed, with some lenders needing to see your most recent P60.

Lenders may also consider regular overtime, shift allowance, bonuses, and commission. If you have more than one employer (maybe you have a part-time job or are self-employed in Doncaster), lenders will also accept earnings from those.

These days, many applicants are self-employed and seeking fast and friendly Mortgage Advice in Doncaster. Self-employed applicants will need help from their accountants to request their last 2-3 years’ proof of earnings from the Revenue.

Our mortgage advisors in Doncaster are able to talk you through what to download from the Government Gateway if you’re in control of your own accounts.

Budget Planner

It’s always smart to plan ahead and do your homework, creating an estimate of what you expect your outgoings to be after you move into your new home. This helps you to figure out roughly how much your council tax and utility bills will be, with any regular expenditures like food and drink added on as well.

It’s also helpful in showing you how much disposable income you’ll have available to pay your mortgage from. We’ll send you our version of a budget planner prior to your mortgage appointment, in hopes that you’ll find it handy to have.

Getting Prepared For a Mortgage

As you can see from what has been mentioned in this article, it’s not super easy to get prepared for a mortgage, though by planning ahead and being careful, you it’ll be quite a bit easier! Putting in the hard work and remaining patient will definitely go a long way during your mortgage journey.

What is a Cashback Mortgage?

Cashback Mortgage Advice in Doncaster

When it comes to choosing which mortgage product to take out, it can become a bit of a minefield as there are so many choices available. If you’re a First Time Buyer in Doncaster, all of these different options can get a little bit confusing. Each type will work very differently from another too, therefore, it’s best to know how each one works.

In this article, we are going to focus on the Cashback mortgage and look at how they work. Also touching on how it can benefit you and your mortgage situation.

Before we dive into the article, if you’d prefer to watch Malcolm’s video on cashback mortgages, that option is available. Take a look at the moneymanTV YouTube video just below:

What is a Cashback mortgage?

They’re as simple as they sound. Taking out a Cashback mortgage would allow you to get some cash back at the end of your whole mortgage term. They’re usually taken out over long-medium mortgage terms.

The amount that you’ll get back at the end of your term is usually calculated from a percentage of what you have borrowed. Typically, the percentage will be something like 1 or 2%.

In other cases, lenders may state a fixed price in your contract that you signed when you originally took out the mortgage. The amount stated on your contract will not increase over time, this is a fixed price.

Will a cashback mortgage benefit me?

Like all mortgage options, the Cashback mortgage comes with both positives and negatives. Sometimes, it can be down to the lender that you’ve chosen to take out the mortgage with. For example, some lenders may offer a free mortgage valuation or some sort of fringe benefits with your product.

Cashback mortgages tend to appeal to customers that are borrowing lower mortgages. You will get money back at the end of your term and possibly some benefits on the side. If you manage to get offered a competitive percentage on a Cashback mortgage in Doncaster, it may be worth considering as it will be worth the investment in the long term.

There is only really one downside to these types of mortgages, and that’s that they tend to come with high interest rates.

Different types of mortgages in Doncaster

When compared to other mortgage options, the Cashback mortgage isn’t at the forefront of the market; it’s not the most popular amongst homeowners. This doesn’t mean that it’s not an option worth considering.

As a mortgage broker in Doncaster, we do occasionally see Cashback mortgages being taken out, therefore if you are interested in them, they’re still available!

If you don’t quite qualify for your first mortgage option, they make a great backup option. If you want to find out more about the Cashback mortgage and the other types of mortgages that are available, you should get Specialist Mortgage Advice in Doncaster from our advisors. We will be more than happy to go through all of your mortgage options with you.

Get in touch by booking your free mortgage appointment online today.

The Costs of Buying a Home in Doncaster

First time buyer mortgage advice in Doncaster

Buying a house in Doncaster or any property will possibly be one of the most significant financial decisions you make in a lifetime.

That said, first time buyers in Doncaster like yourself need to be aware of the additional costs when you purchase a house before you jump onto the property ladder.

The break down of costs

Deposit

One of the most considerable costs of buying a house is having a deposit. Your deposit will all depend on the price of the property you are purchasing.

For example, if the buyer has a 5% deposit of the purchase price and got accepted. A mortgage lender would then lend you the remaining 95%. The larger the deposit you can put down, the better mortgage deals you will may be eligible for.

Estate Agency Fees

You only need to deal with estate agent fees when selling a property. Their services can vary between companies, so make sure you try to find the best price and leading service before diving into anything.

We find that the cheapest agents tend to be online ones who don’t have to worry about the costs of maintaining offices.

If you prefer a more personalised service, you may have to pay an extra 1-2% of your property selling price. The fees usually have room for negotiations, especially in a “seller’s market”.

(A seller’s market is where agents are fighting to get your instruction because of the lack of houses on the market.)

Valuation Fees

A lender will need to be sure of whether the property is worth what you’re going to be paying for it. Your lender may offer you this service for free, although they may not send you a copy of the report in return.

When this is the case, you may need to pay a fee. The prices can vary and be more expensive if you wish to select a more detailed report or not; it is entirely up to your choice.

Your decision will likely depend upon the age and type of property you are purchasing, along with any concerns you have about the property in question.

Mortgage Arrangement Fees

Some mortgage products offer comparatively cheap rates. The benefit can be outweighed by an arrangement fee made payable to the lender. Not every product will have one, so the cost.

An example, could either be nothing, or as much as £999+. It all depends upon the lender and the product you have chosen.

Sometimes these are to be paid upfront or you can elect to add these to the balance of your mortgage, but you would then incur further interest charges.

As a mortgage broker in Doncaster, we can compare mortgage deals factoring in the costs to give you a more general overview of your expenses.

Solicitor’s Fees

You’ll need to take up the services of a solicitor, wherein the fees quoted by various firms can differ by massive amounts.

Whether it’s a freehold or leasehold, you will need to give the property address and give the purchase price to obtain quotations on what you’ll have to pay.

  • Ensure the firm includes VAT
  • Ensure the firm includes the cost of any “disbursements.” These are fees such as Land Registry Fees and Authority Search FeesIs
  • Is your solicitor on your mortgage lenders panel?

Stamp Duty

In addition to your Solicitor’s fees and disbursements, you’ll be required to pay this tax which the solicitor collects on completion of the property purchase.

Full details can be found here – a residential purchase of £180000, the Stamp Duty would be £1100.

Broker Fees

Your mortgage broker will usually charge a fee for their service. Please try to use a company that charges on completion only and avoid any application fees where your money will be at risk.

Removal Fees

The cost of moving your furniture can vary significantly and will depend on the level of service you are looking for.  If you are quite happy to hire a van and roll your sleeves up, this can cost less than £200. 

On the other hand, if you are looking for a company that provides the full service this can be £1,000 plus.

If you would like to discuss the costs involved in obtaining a mortgage in more detail then please don’t hesitate to get in touch.

Doncastermoneyman.com & Doncastermoneyman are trading styles of UK Moneyman Limited, which is authorised and regulated by the Financial Conduct Authority.
UK Moneyman Limited is authorised and regulated by the Financial Conduct Authority.
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© 2021 Doncastermoneyman

Doncastermoneyman, 3 Cavendish Court, South Parade, Doncaster, DN1 2DJ.

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