Mortgages

Buying a property can be the biggest decision made in our lives. It is for this very reason that impartial advice is critical from qualified advisers.

First-Time Buyers

Buying a property can be the biggest decision made in our lives. It is for this very reason that impartial advice is critical from qualified advisers.

Ensure that you are realistic when working out exactly how much you can afford to spend on your new house. You should ensure the intended mortgage is affordable (by doing a budget calculation) and it is wise to seek a Decision in Principle certificate, so that you know how much you can offer once you have found a suitable property.

Even a newly built house will require some sort of furnishings, whereas older properties may require extensive work, such as re-flooring, tiling or renewing the wiring. Make sure that you factor in all these likely expenses, in addition to the purchase price, and other fees such as conveyancing and stamp duty.

When buying for the first time

There may be a number of details in the houses you are looking at, which you may not pick up. Always take an experienced home buyer, such as one of your parents, or a home-owning friend, when looking at property. If this is difficult to arrange, then make sure you at least get some assistance once you have selected a property you like and are arranging a second viewing.

Remortgages

When you remortgage, you are switching your mortgage to another deal, and frequently, another lender.



Remortgages can be used for various reasons. However, most people simply switch mortgages because it will work out cheaper for them. For example, the introductory discounted interest rate may have finished with your current lender; therefore you could potentially get a new discount rate, or a lower APR, with another lender. Another example is when you may need to re-mortgage to consolidate debts.

It is worth noting that a remortgage is not the best option in all cases

Even if the lender you are considering switching to is offering a lower APR, you must take into consideration the facts that:

The new lender may charge you for valuation and solicitors fees, even if you have already paid these for your mortgage with your current lender.
If you switch mortgage remember to look at the overall repayment period. You may be able to pay less monthly, but check the final repayment date of the mortgage as well.

Also you may be able to switch your mortgage deal with your current lender, avoiding any unnecessary costs. Many lenders will allow you to switch your mortgage deal reasonably frequently.

Buy To Let

There are 3 main differences in buy to let mortgages:

  • Rent Potential – the decision as to whether or not a mortgage will be offered is usually based on the rent you will earn as well as your income. In some cases your income is not ever considered.
  • Interest Rate – buy to let mortgages have slightly higher interest rates.
  • Larger Deposit – typically a minimum of 25% of the property’s value is required as a deposit.

When buying a second property to let, you will need to decide whether your primary objective is income or capital growth. In other words, are you looking to make a profit month on month or are you looking to make a profit through increased equity from the second property if it increases in value over time? The decision may affect the type of property you purchase, and the location.

When you manage a property there are many costs involved in addition to the monthly mortgage repayments. As a guide, you should be aiming to achieve a gross rent of about 135% of the rental property’s interest only mortgage repayments in order to cover your costs should anything go wrong. Not all Buy to Let Mortgages are regulated by The Financial Conduct Authority.
Reviews and Ratings for Financial adviser Tara Harper, Bournemouth