First Time Buyer Mortgage

The recent announcement by the Government to scrap stamp duty for all first-time buyer properties under £250,000 has meant there has been a surge in first-time buyers seeking out their first mortgage.

According to Moneysupermarket.com, there was a 15% jump in the number of prospective first-time buyers visiting its website since the Budget announcement. It’s been a tough few years for people trying to get onto the UK housing ladder, so the tax break couldn’t have come sooner for many who have been scrimping and savings for their first deposit.

The website also found that there has been a 17% increase in the number of 90% loan to value mortgages available and the number of 80% LTV loans available is up by a third. So not only have first-time buyers got a tax break but they also now have a better chance of getting hold of a loan.

Hannah-Mercedes Skenfield, mortgage channel manager at moneysupermarket.com, says: “As we approach one of the busiest times of the year for house-hunting, the first-time buyer could well be back out after months of hibernation.

“Whilst the majority of our users say the stamp duty cut is a good thing, and recognise that people need help to buy their first home, the reality is that until LTVs and corresponding loan rates improve, the situation remains largely the same. Without a large deposit, you’ll find yourself on a higher rate and that’s if you can get a mortgage at all. It will be interesting to see over the long-term what impact this has.”

If you think the time is right to get on the housing ladder, talk to a mortgage expert about what you have to do to get your first mortgage. You still need a large deposit and rates are still high, so it would be a good idea to get some help in getting your first home loan.

SOURCE: Moneysupermarket.com, 01/04/10

To Keep up with news and comments on the current adverse credit market please visit the Adverse Mortgage Blog.

Rates for mortgages of 90% loan to value have dropped by a third over the last three months meaning those borrowers who have been locked out of the mortgage market may now have a much better chance of getting an affordable home loan.

According to Evaluate Technologies, rates for borrowers with deposits of 10% have fallen by nearly a third in the past three months as competition in the mortgage market increases. It says average initial rates for borrowers at 90% LTV have dropped to 5.3%, down from 7% in November. This cuts monthly payments by £160 on a £150,000 loan.

But the best-buy rates at 90% LTV are still more than double the average 2.58% charged for borrowers at 60% LTV. As is always the case, if you have more money you can afford more equity and that means you are a better bet to lenders and they can afford to offer a cheaper rate of interest on a home loan.

Jim Barrowman, national accounts director at Evaluate Technologies says: “It is a genuine sign of confidence that lenders are now willing to lend at 90% LTVs and also that they are cutting rates for borrowers. The revival is to be welcomed and shows that gradually lenders are getting the message that if people with smaller deposits are creditworthy enough to qualify for a loan they should not have to pay too much of a premium.”

If you want to be sure of the best 90% LTV deal you need to speak to a mortgage adviser. These deals are still rare and they still need a specialist to help manage them from application to signing on the dotted line, and beyond.

SOURCE: Evaluate Technologies, 16/02/10

To Keep up with news and comments on the current adverse credit market please visit the Adverse Mortgage Blog.

If you are looking to get onto the housing market while house prices are still relatively low, there are a number of things you must think about before picking out your dream first home.

The first thing to remember is that mortgage lenders are very fussy and will make sure to credit score you before offering you a loan. Basically, the lender assumes you are guilty of not being able to handle a large loan unless you can prove otherwise. So make sure, before you begin first-house hunting, your score is as good as it can be.

That means making sure you never go overdrawn unless you have agreed an overdraft facility. if you cannot handle your own finances a lender will suspect that you will not be able to handle a large, six-figure loan. Also, if you are renting don’t miss any payments – if you cannot pay your rent why should a lender think you are able to pay a mortgage?

Once you are sure your is as good as it can be, get an ‘agreement in principle’ from a lender before you start property hunting. Talk to a mortgage adviser how you can do this, but basically it will give you an idea as to how much you can borrow and in this market this is really important as lenders are requiring bigger deposits than before. So you will know exactly how much you can afford and what sort of property you can aim for.

There are numerous other things you can do to make sure you get onto the property ladder successfully – create a budget, get an independent survey of the property you choose, invest in some good savings products, get good legal advice – but the most important thing you can do is talk to a professional mortgage adviser.

Karen Barrett, chief executive of Unbiased.co.uk says:  “Over the last two years, consumers have watched on as the property market slowed down, lenders tightened their lending criteria and the amount needed for a house deposit soared.  As a result, many first-time buyers have been left worrying as to whether they’ll ever have their feet firmly on the property ladder. Seeking advice from a qualified and whole of market mortgage adviser will provide you with the information and help you need.”

SOURCE: Unbiased.co.uk, 08/02/10

To Keep up with news and comments on the current adverse credit market please visit the Adverse Mortgage Blog.

The Government has introduced new rules that will seek to further aid the millions of people struggling with adverse mortgage finances.

The Financial Services Authority has revealed that it is considering proposals that would see no additional charges are incurred by a mortgage borrower where a formal agreement between lender and borrower is in place. This is great news because for struggling mortgage borrowers, to have an additional £30 or £40 monthly arrears charge added to your mortgage balance, despite having agreed a repayment plan with your lender was merely compounding the problem for those doing their utmost to stave of the threat of repossession.

Things are still tough for many mortgage holders right now: the Council of Mortgage Lenders says that 194,600 mortgages in arrears by 2.5% or more of their outstanding balance. For these people all the good advice in the world wouldn’t stop the blow of additional surprise payments.

Andrew Hagger of Moneynet.co.uk says: “This will be welcome news to thousands of genuine people who are battling to keep a roof over their heads. With unemployment running at a 13 year high of just under 2.5 million, there will be a lot of people struggling to meet their mortgage repayments due to circumstances beyond their control.

“It’s hardly treating customers fairly to for lenders generate additional profits by charging arrears fees to people who are adhering to temporary reduced repayment plans.”

Sue Edwards, head of consumer policy at Citizen’s Advice says: “That the FSA compel lenders to consider all options before repossessing and the confirmation that arrears payments made by borrowers must be allocated to clearing missed monthly payments first, before they pay off charges.

“The strengthening of these existing rules will help protect vulnerable homeowners from avoidable homelessness and we hope to see them implemented as soon as possible.”

SOURCE: CML, Sep 09, Moneynet, CAB, FSA, 26/01/10

To Keep up with news and comments on the current adverse credit market please visit the Adverse Mortgage Blog.

Any good mortgage adviser will tell you that adverse mortgage solutions take time – but for long-term plans to come to fruition, borrowers have to set themselves attainable long-term financial goals.

In the past, debt could be solved in an instant -  a quick secured loan, another credit card approval or an instant remortgage and you were done. But the days of cheap, quick credit are dead and buried and those who need financial help must come to terms with the fact that getting out of debt is a long process.

It is possible though – by working on paying off mortgages, clearing credit card balances and reducing overall debts you will improve your credit score and in turn make you a better bet as a borrower in the future. When mortgages become more readily available it will be the borrowers who can show, via their credit score, that they have become sensible borrowers who are front of the queue for a new mortgage.

So it’s all about long-term, attainable goals. To say that you will clear £30,000 of debt in a year might be a bit too hard to achieve, but to say that you will clear £2,000 of credit card debt in six months or you will reduce the number of cards you own from five to three over a year is something that you can do.

You may be able to save £200 a month by cutting out non-essentials, you may be able to guarantee yourself that you will pay your mortgage every single month, with no arrears, for the next year – all this is possible and all this will help you in the future.

Getting clear of debt isn’t easy and it will not happen in a few months – and any debt ‘solutions’ that say otherwise are simply wrong. The only thing that will get you out of debt and will improve your chances of a future mortgage are long-term goals.

Talk to your mortgage adviser and ask them to help you put together a plan that will mean you become a better borrower, a plan that will make sure that you avoid future mortgage arrears and a plan that will make your financial life a whole lot less stressful.

To Keep up with news and comments on the current adverse credit market please visit the Adverse Mortgage Blog.

Potential first time buyers would be £1bn better off buying a property than continuing to rent according to a new study from Abbey Mortgages.

According to the bank’s research, 1.61 million Britons said that they were looking to buy in areas of the country, other than London, and based on today’s prices these people would save £624 each – or a collective £1bn over the next 12 months by doing so.

These potential first-time buyers spend £434 on rent, on average, while those buying a property for the first time with a 25% deposit would currently see a monthly mortgage bill of £382 – an average saving of £52 per month. Across the country, the research into typical first-time buyer flats and terraced properties found that in the last 12 months, average prices have decreased by 9%, to £92,861. This means a first-time buyer will need an average deposit of £23,215 if they want to buy a property with a 25% deposit.

Interestingly, in December 2008, Abbey Mortgages found buying a property to be an average of just £51 cheaper than renting each month – so things have improved significantly for those looking to get onto the housing ladder.

Nici Audhlam-Gardiner, director of Abbey Mortgages says: “Our latest research shows there is hope for first-time buyers trying to buy their first home. It’s now cheaper in all bar one of the regions to buy rather than rent and shows that saving for that all important deposit is so worthwhile too.”

SOURCE: Abbey, 09/10/09

To Keep up with news and comments on the current adverse credit market please visit the Adverse Mortgage Blog.

Britons over 50 have still got significant non-mortgage debt, with some taking on even more during this recession – unsecured, short-term debt is simply not the answer and those older people must seek professional mortgage advice right away.

Research conducted by moneysupermarket.com has found that whilst more people in the UK are paying off their non-mortgage debt than increasing it, more than half of the country’s 50 plus population is still carrying an average of £6,734 non-mortgage debt.

Worryingly, more than a fifth of over 50′s have taken on more debt, with five per cent increasing debt “a lot” over the past year. Of those who are still carrying debt, almost one in six believe debt will always be a part of their life, and they expect to live life in the red – and nearly half of those whose debt has increased in the past year said they had gone further into the red in order to keep paying the bills.

Tim Moss, head of loans and debt at moneysupermarket.com, says: “At a time when people should definitely be decreasing rather than increasing their borrowings, the fact that half of the people in this age group are still in debt above and beyond their mortgages is alarming. Those aged over 50 have to factor how long they can continue earning, and begin thinking seriously about their finances in retirement – debts that are currently easy to service could become a millstone round their neck in later retirement years.”

For those who have seen significant increases in their indebtedness over the last year, they must go through their household budget ruthlessly, line by line, and identify where outgoings can be cut. They must see how they can save and how they can do what they can while they are still earning. But they should also go to a mortgage adviser – the biggest debt anyone has is their mortgage, so seeing if that debt can be made cheaper must always be considered.

Moss says: “Anyone starting to worry about their financial situation shouldn’t bury their head in the quick sand of debt – problems are easier to tackle when addressed early.”

SOURCE: Moneysupermarket.com, 05/10/09

To Keep up with news and comments on the current adverse credit market please visit the Adverse Mortgage Blog.

As the recession rolls on, one in five people are missing precious sleep and free-time through working longer and harder to make enough to get by.

As UK unemployment hits 2.38 million, uSwitch.com has found that workers really are pulling out all the stops to earn extra cash with 5 million consumers, that’s a fifth of the nation’s workforce, currently burning the midnight oil and cashing in on overtime. This has increased from just 19% of consumers in August 2008 when the recession first started to become a reality.

Much of this overtime could be due to the fact that UK workers have been subjected to pay freezes, unpaid leave, reduced hours or, for some, working for no pay at all.

Meanwhile, 2.7 million people have been forced to take on a second job in order to top up their income and make ends meet. For those people that previously had the luxury of not going to work at all times have also changed with 1.6 million rejoining the workforce in the last year.

Louise Bond, personal finance manager at uSwitch.com, says: “With unemployment levels set to rise over the coming months, it’s understandable that many workers are forced to put career aspirations on the back burner and focus on keeping the money coming in. People’s working habits have had to change to increase income levels which includes returning to work, picking up overtime and moving from part to full time work.”

Remember, there are always alternatives to taking on extra hours is not the only way to bolster your income. A simple review of your loans, mortgage, credit cards and current accounts could save a lot of money – talk to an adviser about making the most of what you have now before taking on extra, grueling work.

SOURCE: uSwitch.com, 24/07/09

To Keep up with news and comments on the current adverse credit market please visit the Adverse Mortgage Blog.

It might seem strange, but there are actually mortgages out there just for people with bad credit. Mortgages for bad credit have been created not for those who wish to stay in bad credit, but rather for those looking to get out of trouble and move forward. They are called credit repair loans, and they are the best way to turn your black marks green. They are not easy and they are expensive, but if you have lived with bad credit, you will know how rewarding it would be to be free of your problems. So if you want to work your way into good credit choose mortgages for bad credit.

Learn more about Mortgages for Bad Credit And Credit Repair

A bad credit mortgage re mortgage could be the best solution for you if you have been in debt. Its one way to repay your debts and get a fresh start. There are dozens of lenders who offer a bad credit mortgage re mortgage and thousands of deals, so you wont have far to look. Its one way to get past the problem of easy credit which you cant repay. Although you can go to lenders directly, some deals will only be available through a broker, who can save you the legwork. As a specialist, the broker can recommend a good bad credit mortgage re mortgage.

Read more on Getting the Most from a Bad Credit Mortgage Re Mortgage