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The Mortgage Minefield

Gone are the days when you could pretty much walk into your bank and ask nicely for a mortgage and then pretty much be sure they would lend to you. These days there are dozens of lenders out there and each and everyone of them have different criteria. Some lenders will only lend to state retirement and some will lend to age 75. Some will only use your basic income and some will use everything including bonuses and overtime. Where do you start? Do you go to your bank? Do you look online? You should always use a specialist, always use someone who has access to the whole of the market and someone who is up to date with all the lenders criteria.

But with house prices steadily rising again especially in areas like Sherborne lenders are becoming more eager to lend. So for people wanting to re mortgage this is a good time, there are fantastic low fixed rates on the market as low as 1.29% dependant on your situation.

How about first time buyers wanting to get on the property ladder, is it as hard as the media says? Do they need to find whooping deposits to put down? Lenders are now starting to realise that the first time buyers are what makes the market move so are gradually bringing out products that need only a 10 % or sometimes low as 5% deposit. Also you should take advantage of the government help to buy schemes that are available.

With a Help to Buy: equity loan the Government lends you up to 20% of the cost of your new-build home, so you’ll only need a 5% cash deposit and a 75% mortgage to make up the rest. You won’t be charged loan fees on the 20% loan for the first five years of owning your home. - See more at:

Example If you bought a home for £200,000 and you sold for £210,000, you’d get £168,000 (80%, from your mortgage and the cash deposit) and you’d pay back £42,000 on the loan (20%). You’d need to pay off your mortgage with your share of the money. –

Mortgage guarantee for purchase of new build or existing propertyA mortgage supported by the Help to Buy: mortgage guarantee scheme works in exactly the same way as any other mortgage except that under the scheme the Government offers lenders the option to purchase a guarantee on mortgage loans.

Because of this support, lenders taking part are able to offer home buyers more high-loan-to-value mortgages (80-95%).

You will still be fully responsible for your mortgage repayments. So if you have a 5% deposit, you will need to take out and pay back a 95% mortgage.

All in all as they say the future is looking brighter!

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