Have you considered becoming a landlord?

invest in property

Despite a turbulent economic climate, the buy to let market has been going from strength to strength. With the average first time buyer now being 37 years old*, there has been an increase in demand for the rental sector, so now may be a great time to invest in property.

The latest Paragon survey shows the highest level of buy-to-let mortgages per quarter since the financial crisis began.  With first time buyers finding it difficult to raise the deposits required to get on the property ladder, alongside improved mortgage products from lenders, landlords have increased confidence in the buy to let market and have seen significant growth.

Lenders have recognised this area as a growing market and there are a large number of competitive mortgage products to help investors take advantage of this opportunity and become a first time landlord.

As with any investment, purchasing properties to let does carry risks but by seeking financial advice you can discuss all aspects of the buy-to-let market so you can feel secure in your decision.

Why not speak to us here and we can take you through all your options and help find the right buy-to-let mortgage for you. We are able to provide a full advice service and guide you through the whole process. There are many things to take into consideration when taking out a mortgage such as general insurance and protection; thankfully we all offer a full service in insurance so why not contact us today?

Your property may be repossessed if you do not keep up repayments on your mortgage.

 

*Source: Money Supermarket

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Home Buying Tips – Tip 1 – 5

It is the biggest purchase of your life – let’s make sure that you get it right!

Here are the first 5 tips to buying a new home

1. Get financial advice – Day one. I was deliberating this one because I am a broker and I did not want to use this thread to “sell my services”. However what is the point in going shopping without any money?!?

A good Broker can tell you how much money you are going to need for a deposit and fees. He can also work with you to find out how much you can afford and how much you can borrow.

If you are not ready yet he can help draw up a plan to get you in a position to purchase, or if everything “fits” – he can get you an Agreement in Principle from the Lender.

2. List all of the costs

Deposit required Varies
Mortgage Arrangement fee – Typically £500 – £1500
Valuation Fee Typically £200 – £300
Legal Fees Typically £800 – £1000
Stamp Duty 1% of the purchase price over £125,000, 3% over£250,000 as so on
Surveys More detailed surveys cost more money typically £400 – £800
Removals Depends on distances involved
House repairs and furnishings You’ve bought the house, now it’s time to fill it up. Don’t leave yourself so broke you have to sit on the floor!

3. Make a list of Needs and Wants

The Needs are what a property must have. For instance, if it has to have a minimum 3 bedrooms what’s the point in seeing one with 2?

The Wants are what you would like the property to have. You want to find a property with as many of these as possible, but if a property didn’t have some of these it wouldn’t necessarily be a deal breaker.

Just remember to be realistic, if you can’t find that 5 bed Town House in Kensington for £250,000 then perhaps you need to lower your sights.

When you are seeing loads of properties this will help you to keep track and short list those ones for a second viewing.

4. Don’t be shy – in the UK we don’t like to haggle but as the saying goes if you don’t ask you don’t get.

So, these are the golden rules….

  • Set a maximum / “walk away” price.
  • It is all too easy to get carried away whilst bidding but make sure you set a maximum price you are prepared to pay for the property.
  • Start low.

Put in a “cheeky offer” say 10% – 15% below asking price, if you have someone who wants to move in a hurry they might say yes!

If they say no –  ask them what they would accept. Then you can always put in another higher offer…. just remember to walk away when you hit your maximum price.

Usually you will meet somewhere in the middle.

  • Maximise your position.

If you are a first time buyer with no property to sell, tell them that it means you can move quickly.

Tell them you have your finance arranged and have an Agreement in Principle with Solicitors all   tee-d up and ready to go.

Tell them you have a highly motivated broker ( I’m sure I know one of those) who can get everything tied up quickly.

5. Arrange a Mortgage in Principle*

I know I touched on this earlier but the reasons for doing this are important:

1) It gives you a much more accurate reflection on how much you can borrow. A lenders calculator or a comparison site will only give a very rough indication.

2) It stops you falling in love with a property you can’t get the finance for.

3) It strengthens your buying position and show’s you are serious.

4) It can put an end to any Estate agent – “you have to sit down with our adviser……” tricks.

5) It allows you to move fast instead of losing out on a property.

6)  We know in advance if there are any issues on the credit file and arrange a plan to sort them.**

*Be careful about obtaining an agreement in principle from multiple lenders as this could stop you getting any finance for a period of time.

**Did you know a single late payment on a credit card will mean some lenders will not lend to a First Time Buyer

 

        5 More Home Buying Tips in the next blog………….

Your home may be repossessed if you do not keep up repayments on your mortgage.

Your initial mortgage consultation is obligation free. There may be a fee for our mortgage service of up to £395 though in some circumstances this may be waived. Being independent we also offer a “fee only” option which is typically 1% of the amount borrowed and any commission derived from the lender is returned to you. The precise amount will depend on your circumstances and mortgage loan amount, and will be discussed and agreed on before you make a mortgage application.

Home Buying Tips – Tips 6-10

It is the biggest purchase of your life – let’s make sure that you get it right! 

6. What’s in the Neighbourhood?….

  • Do you like the local shops?
  • Is there graffiti on the walls?
  • What are your priorities? – What do you need in walking distance: Good schools, Pubs, shops,….?
  • Are there parks and open spaces?
  • Pop in to the local police station or ask the local bobby.

One of my clients thought it was wonderful to live down the road from a pub……that was until he found out that the local youths drunken pass time was to run across the roofs of cars on their way home. Unfortunately he had a convertible!!…..

7. The top ten things to ask the sellers:

1. Who lives upstairs/ downstairs, next door?

2. Have there been neighbour disputes?

3. How long has it been on the market and how many viewings / offers have they had?

4. If it is a flat – how long is the lease, how much is the ground rent/ maintenance charge?

5. How long have they lived there and why are they moving?

6.When was it rewired, how old is the boiler and when was it last inspected?

7. Have they found a property? If so how many people are in the chain?

8. Have there been any structural problems?

9. What is included in the sale?

10. What renovations have been done?

8. View at different times of the day/ week

Does a quiet road on a Sunday become a noisy speed track on weekdays?

Is it quiet in the day because the neighbours are at work only to play loud music at deafening volumes until the late hours?

….Do yourself a big favour and arrange a few viewings at different times

9. Take photos with your mobile

This can help you keep track when you are viewing many properties

10.  Check out the neighbours

It’s useful to find out who you will be living next to, also chat to neighbours who may be a little further away as they are more likely to be honest. They are less likely to be friends with the neighbours or anxious to get shot of them.

 

    5 More Home Buying Tips in the next blog………….

Your home may be repossessed if you do not keep up repayments on your mortgage.

Your initial mortgage consultation is obligation free. There may be a fee for our mortgage service of up to £395 though in some circumstances this may be waived. Being independent we also offer a “fee only” option which is typically 1% of the amount borrowed and any commission derived from the lender is returned to you. The precise amount will depend on your circumstances and mortgage loan amount, and will be discussed and agreed on before you make a mortgage application. 

I’m a Control Freak!

I’m going to admit it, I am a bit of a control freak and there are parts of my job that drive me nuts!

Let me just start by saying I love what I do. Chatting to my clients, finding the best deal that’s the fun bit. Even with the masses of paperwork there is a certain satisfaction to knowing its correct.

Things would be fine if that was the whole job but from day one sometimes it seems that everyone else is trying to put a spanner in the works:

Here’s the top 5 things that drive me nuts

1. Solicitors

When I first started as a broker I needed to find a reliable solicitor to work with to cover the legal work for my clients. Over the first 2 years I used multiple firms – most were fairly poor:  Asking for documents at last minute before completion, missing completion dates, losing documents, not returning calls ….I could go on.

If you think that sounds like your average solicitor you would be right….but after searching high and low 7 years ago I found that elusive thing a “proactive” solicitor – yes they do exist! His name is Mark Lloyd and he actually chases me for the mortgage offer, he updates my clients without being asked, always gets back to me, he asks me to get involved if I need to get something outstanding. In short he’s another control freak and my client’s love him for it.

2. Lenders

Now I have to be careful here because if I rant too much they might stop giving me the money I need  for my clients!

Lenders like to withdraw rates with little to no notice. I had a notification from a lender that a rate would be pulled by close of business that day (5pm) Thanks for the heads up at 4.45pm. You can’t even key in an application from a client that quickly!

Lenders that ask for documentation one piece at a time. ” I know we asked you to get this from your client yesterday but can you get this from them now” – GGggggggrrrrrrrrr!!!

Lenders whose own staff don’t know their own criteria. A suggestion – read your own manual!!

Don’t get me wrong some lenders are an absolute joy to work with, I just don’t know how other lenders can make the same process so painful.

 3. Doctors surgery’s

Don’t get me started here!

If you need Life cover to protect your family when getting a mortgage, sometimes an insurer will require a Doctors report. They pay the Doctor up to £90 for what is often a couple of paragraphs. So why can it take up to 4 months (if left to their own devices) to get one back.

Most Surgery’s attach no importance to the task. However if it doesn’t come back in time we have one of 2 things we can do:

1. Delay the date you move into your new house.

2. Proceed without cover.

Option 1 is a real pain but Option 2 is dangerous, because depending on the cover if you suffered an accident or died before the cover is “live” your family could lose everything and be out on the streets.

This is not being dramatic, I have had more than one client calling me within a week of taking the keys to their property needing to claim on their insurance. If it wasn’t  “live” then that family would be homeless as well as dealing with some devastating news.

The point is that it is so un-necessary. Some surgeries are very efficient, proving it can be done.

To those surgeries that have no administrative faculty….”Get your finger out, get organized and get me that report”!!!!!

4. Estate agents

From the offset:

1. Stop trying to force people to use your broker if they don’t want to because you are on a commission. If they decline leave it alone.

2. Don’t lie to them by saying that you have to financially vet them before you can put in an offer.  A purchaser has a legal right to bring their own financial and legal team to the process.

During the process:

Please, for the love of all that’s Holy, return calls when you say you will and communicate information up and down the chain when asked to.

 

5. Clients

Yes you!! – I’m talking to you!!

You see that Mortgage deed that has been sat on the coffee table for a week…. I need that back a.s.a.p if you want to complete by the weekend………

So next time you speak to a Broker find out if all he does is arrange the mortgage and leave you to it or does he like to be a little more controlling………

Your home may be repossessed if you do not keep up repayments on your mortgage.

Your initial mortgage consultation is obligation free. There may be a fee for our mortgage service of up to £395 though in some circumstances this may be waived. Being independent we also offer a “fee only” option which is typically 1% of the amount borrowed and any commission derived from the lender is returned to you. The precise amount will depend on your circumstances and mortgage loan amount, and will be discussed and agreed on before you make a mortgage application.

Home Buying Tips – Tips 11-15

It is the biggest purchase of your life – Let’s make sure that you get it right!                  

11. Work out what you can afford

What you can borrow and what you can afford are 2 different things.

  • If you are going to stretch yourselves to buy the biggest property you can afford, will you be happy with the compromises to your lifestyle such as socialising less?
  • Would you be more comfortable spending less and having more disposable income?

This is where a Broker can really help. They can provide “real–world” figures and help you define a realistic budget you are comfortable with.

12. Private deal

If you see a road you would really like to live down, why not write a nice letter and post it through the letterbox’s of houses that you like.  Owners may be keen to sell because they won’t have to pay an Estate Agent’s fees. This can really work!!

13.Buying at auction

  • The Golden rule regarding buying anything at auctions is to go a couple of times before you want to buy – just to get a feel for things.
  • Make sure you get a full survey to make sure you know what you are buying.
  • Get a solicitor to check for legal issues
  • Have a maximum “walk away” price for the property and STICK TO IT!
  • This is different to a normal purchase – as soon as the hammer goes down it will cost a fortune to pull out
  • You will have to pay a 10% deposit, YOU WILL LOSE THIS IF YOU DONT COMPLETE WITHIN THE ALLOTED TIME (USUALLY 4-6 WEEKS)
  • Use a broker to arrange the finance first. The lender he selects may not be based solely on the lowest rate but also the ability to complete quickly.
  • If you have a property to sell then make sure you have completed on the sale before going to auction. As a delay could cost you BIG!

14. Ask them to take the property off the market

Make your offer conditional on the basis that they take their property “off the market”. This will help to stop you being gazumped (where a seller accepts a higher offer having accepted a lower offer).

Either part can pull out right up until exchange of contracts.

15. Minimise your financial exposure

Some property chains are simple -if it’s just you and the seller and both you of you want to complete as quickly as possible then you can pull out all the stops.

However most property chains are more complex and may take longer to form. As soon as you put in an application with a lender they will carry out the valuation/ Survey. This could be up to £1000 (depending on type), the way I work with my clients is to hold off on this until the chain forms. If the chain collapses then you haven’t lost the survey fee.

The same goes with search fee’s (£200 – £250). Get the mortgage offer in place and make sure the chain is fully formed before you fork out!

 

5 More Home Buying Tips in the next blog………….

Your home may be repossessed if you do not keep up repayments on your mortgage.

Your initial mortgage consultation is obligation free. There may be a fee for our mortgage service of up to £395 though in some circumstances this may be waived. Being independent we also offer a “fee only” option which is typically 1% of the amount borrowed and any commission derived from the lender is returned to you. The precise amount will depend on your circumstances and mortgage loan amount, and will be discussed and agreed on before you make a mortgage application.

Why use a Broker?…. Why shouldn’t I just go directly to a Lender?

Reason 1 – Choice

Okay! Okay! – I know what you’re thinking! Of course I’m going to recommend using a Broker because I’m biased. But that’s the whole point – a Whole of Market Broker isn’t biased towards one Lender – he can find the best Mortgage to suit your circumstances.

In simple terms a Lender is a shop that sells money, a Broker helps you pick the BEST shop!

Reason 2 – Advice

Many people are not aware that many Lender’s do not offer advice, they simply show you the range of available products and let you pick. They are not accountable for advice because they give none.

A Broker is fully accountable and works under full advice and recommendation. Unlike a Lender who may have 4 or 5 mortgages – a Broker may have to select from 1000’s and therefore the questions asked are much more thorough to ensure the mortgage is the best one available for you.

There are also many things so consider other than the headline rate including: Lender criteria, loan to value, portability, fees, incentives, term, overpayment, tie-in, rate type, service levels – a good broker should be able to advise on these based on what is most important to you.

Reason 3 – Time

Ask yourself these questions:

1.Do you want to spend the time to trawl through the offerings of dozens of Lenders?

2.Do you want to take the risk of losing a lot of time (and potentially your dream home) when you’re application is rejected because of something in the small print?

3.Do you have the time to fill out the forms, ensuring they are filled out right first time and the time for the usual back and forth with the lender?

4.Do you want the headache of chasing up solicitors, chasing Estate Agents, Lenders and Surveyors?

If you answered NO to any of the above questions then you need a Broker, if you answered YES to wanting to fill out paperwork then you need to get out more!

 

Reason 4 – Broker only deals and Lenders

Some Lenders only deal with Brokers and not the general public

Some high street Lenders give exclusive rates to Brokers

A Broker will give you availability to these products.

Reason 5 -Technology

Many people research mortgage or insurance products on-line using a comparison website. However the information required is basic and does not take in to account more detailed criteria – therefore the recommended product may not be best or even available based on your circumstances. A Broker will use a professional sourcing system which is much more accurate helping to ensure you get accepted for the right mortgage first time.

Reason 6 -Experience

Technology can only take you so far – an experienced Broker is familiar with the rapidly changing criteria in the small print. One example is the type of income that a Lender will take into account. Some Lenders will take 100% benefits, overtime, bonuses etc. Some won’t take any.

No system is sophisticated enough to reference all of this criteria, but a good Broker dealing on a daily basis with his Lenders contacts can.

Reason 7 – Getting Accepted

Did you know if you go to a variety of Lenders and aim to get accepted they may all run credit searches against your name? This could actually stop you getting an acceptance from any of them.

Did you know that many Lenders will not accept someone who has used a pay day Lender in the last 12 months?

A good Broker can help advise on the do’s and don’ts to ensure you get accepted in these days of tougher lending criteria.  Sometimes it may mean that I work with a client for months prior to purchasing to get them into a position where they would be accepted.

Reason 8 – Protecting your Family

Lenders don’t really understand insurance – would anyone want to get insurance from them after the payment protection miss-selling scandal??

They also only have one, usually expensive, Provider. When it comes to insurance one size does not fit all!  You can also spend a lot of money on cover that doesn’t do what it’s meant to do. One slip on the paperwork can mean your insurance won’t payout when you need it to and your family could be homeless.

A decent Broker will advise from a variety of Providers to find you the best product with the best premium that fits your criteria and your budget. He will also make sure the paperwork is filled out correctly.

If you don’t know whether you need waiver of premium, DTA, LTA, Critical Illness, Income Protection, Own Occupation, Suited Occupation, TPD….I could go on…then you need a Broker.

Reason 9 – Ongoing Advice & Other services

A good Broker should keep in contact and also be available should you need to “sound things out.”

Often a client will call me months before a new move so I can supply options before we finalise things.

A good Broker may also be a portal to Commercial Lending, Secured Loans, Debt Advice, Wills and IHT Planning and Pension advice. In essence he is a “go – to” guy for your financial requirements.

Reason 10. Relationships

The average mortgage is 25 years to 35 years in duration – Murder carries a shorter sentence!

If you find a good broker you will be doing business for a very long time. He will get to know how you like to work, he will have a good understanding of your finances and will provide differing financial advice based on your requirements at the time.

A good Broker will proactively give you advice and options throughout your relationship that can save you thousands of pounds and save you from costly mistakes.

In the long run he benefits by your repeated loyalty and you may even refer him to friends and family.  Find a broker who values your business and everyone wins.

Now try getting all of that from a bank….

Your home may be repossessed if you do not keep up repayments on your mortgage.

Your initial mortgage consultation is obligation free. There may be a fee for our mortgage service of up to £395 though in some circumstances this may be waived. Being independent we also offer a “fee only” option which is typically 1% of the amount borrowed and any commission derived from the lender is returned to you. The precise amount will depend on your circumstances and mortgage loan amount, and will be discussed and agreed on before you make a mortgage application.