How to remortgage

Tuesday, 13th February, 2018

2018 is the year of the remortgage.

If you didn’t read my last piece and are wondering why 2018 is any different to 2017 – or any other year for that matter – then read on.

Going up? 

Nobody knows when or even if interest rates will go up in 2018, however there is much talk and speculation that the Bank of England could raise the Base Rate of interest by up to 0.50% at some point this year.

To put this into context, it would mean that someone on a variable rate mortgage borrowing £200,000 would face up to a £600-a-year increase.

Getting the most from your mortgage 

First of all, and despite what you may think, arranging a new mortgage is really straightforward – particularly if your mortgage broker is handling it on your behalf.

As a Guildford mortgage broker we see it all the time; people resisting remortgaging due to the perceived ‘hassle’, only to be pleasantly surprised when it’s all done and dusted without much effort on their part.

Here are Complete Mortgages’ top tips on remortgaging to get you started:

1. Dig out your paperwork 

Having an understanding of how much is outstanding on your mortgage, the mortgage term and any fees attributable with changing your mortgage will make it easier to navigate any questions that you will inevitably have to answer.

2. Know what you spend 

The process of getting a mortgage has changed over recent years, in as much as lenders now want to see clear evidence of your outgoings and, more importantly, your ability to comfortably make the mortgage repayments. Having some idea of what you spend on a monthly basis in advance will save time to-ing and fro-ing.

3. Do your homework

It may sound obvious, but take some time to find out what mortgage products are out there. New mortgage products are entering the market all the time, so make sure you pick the right mortgage for you and your lifestyle. More importantly, make sure that you’re set to benefit from a mortgage switch and that any financial gain from a new mortgage isn’t wiped out with exit fees from your existing mortgage.

Is there an easier way of doing this?

Of course there is. Using a trusted mortgage broker, such as Complete Mortgages, will save you a lot of legwork, time and possibly a bit of heartache, too.

If you let us handle your remortgage we’ll not only manage the entire mortgage application process on your behalf, but we’ll also spend the time finding the right mortgage for you, from the hundreds available (including the many broker exclusives that we have access to). What’s more, depending on the product chosen, there may not even be a fee for you to pay at all.

See, remortgaging really isn’t as difficult as you might think.

Contact the team on 01483 238280 or email info@complete-mortgages.co.uk to find out more. Even if you’re not looking to remortgage, don’t forget we’re also specialists in buy to let mortgages, limited company buy to let mortgages, adverse credit mortgages and commercial mortgages, too.

By Mark Finnegan, Director at Complete Mortgages


Mortgage rules have changed again, but don’t stress

Thursday, 20th July, 2017

Mortgage affordability has, once again, come under the spotlight following the Bank of England’s (BoE) decision to ‘tighten’ the UK’s mortgage lending criteria.

Essentially, the affordability test, or ‘stress test’, which those looking to apply for a mortgage need to undergo, is changing.

Until now, those applying for a mortgage had to prove that they could afford to make mortgage repayments of 3% above the BoE’s base rate. However, the new rules state that the 3% stress test now tests mortgage affordability on 3% above the lender’s standard variable rate (SVR).

By now, you’re probably thinking ‘will this make it harder for me to get a mortgage?’, and we’re pleased to say that, in the main, the answer is ‘no’. And here’s the reason why.

Affordability vs. unaffordability

This is similar to the idea of need vs. want. As is often the case, what we want isn’t necessarily what we need. Likewise, with the new rules (albeit reversed), those applying to get a mortgage may not want to have to pay a mortgage that is 3% more expensive than the SVR, but the majority can if they need to.

Of course, there will be a section of the public who, when faced with this test, may be unable to prove that they could afford the repayments, however professional advice from a mortgage broker will often help applicants reassess their financial situation with positive results.

However, there is another solution.

Don’t rethink, remortgage

As we covered in our last article, the often-overlooked remortgage is a way in which to avoid the SVR altogether. Simply by taking advantage of new mortgage deals you could maintain your same mortgage rate or, as is more often the case, improve on it.

So, rather than rethink in response to the new rules, simply think about remortgaging.

The team at Complete Mortgages always makes contact with its clients three to four months before they’re due to begin the SVR, to a) alert them to this fact and b) present them with new mortgage deals.

All good mortgage brokers should be doing this. If yours doesn’t, then you need to be asking them why. If you don’t use a mortgage broker, then maybe its time to look into finding one that can proactively ensure that you’re not missing a trick.

Back to the new mortgage stress test rules, then. Whilst the BoE has introduced tougher lending rules that stress test at 3% above the lender’s SVR, the reality is that if you proactively manage your mortgage you may never even have to face the SVR – let alone consider paying 3% above it.

For more in-depth information on what the new rules mean for you and how Complete Mortgages can guide you through the process, contact 01483 238280 or email info@complete-mortgages.co.uk. Don’t forget, we also specialise in buy to let mortgages, adverse credit mortgages, limited company buy to let mortgages and first time buyer mortgages.

By Mark Finnegan, Director at Complete Mortgages


The Bournemouth property market isn’t the only thing that’s booming

Thursday, 23rd February, 2017

A recent report* has revealed how Bournemouth is among the UK’s destinations that saw the highest rise in property prices in 2016, with the average price of a home in the area growing by 5.7%.

For those of us who own a property in this wonderful part of the world then this is great news.

However, for those with an equal affinity for Bournemouth yet who aren’t in a position to buy, then this report will no doubt be greeted with a degree of discomfort. After all, a 5.7% increase is not insignificant and, for some, could place applying for a mortgage and, ultimately, homeownership, even more out of reach.

The good news is that the current mortgage market is littered with a variety of mortgage products that aim to target a huge cross section of people – from first time buyer mortgages through to buy to let mortgages – to ensure that everyone has a fair chance of getting on (or in some cases, keeping on) the property ladder.

And on the topic of mortgage selection and availability, it isn’t just Bournemouth that’s booming. Adverse mortgages, or what were referred to as subprime mortgages prior to the financial crisis in 2007/8, are back – albeit in a different and thankfully much safer guise, and this time they are operating to a much tighter framework.

In contrast to the years leading up to the financial crisis, where sub-prime mortgages were awarded to people without necessarily understanding their ability to make repayments, the new generation of adverse mortgage lending is very different.

Unlike the prime market, for instance, whereby decisions are made, in part, by computers, mortgage brokers providing subprime mortgages, such as Complete Mortgages, now spend more time listening to an individual’s circumstances in order to understand the bigger picture before approaching lenders.

Applicants still need to be financially robust enough to show that they can meet mortgage repayments; it’s just that the decision to grant a subprime mortgage takes into account a wider pool of variables that a binary ‘black and white’ approach afforded by algorithms and automated software cannot.

Complete Mortgages, for example, even works with insolvency practitioners to help applicants build a case for being granted a mortgage around existing financial commitments and debts.

Moreover, the ever-growing portfolio of adverse mortgage products is aimed at those who may have unfortunately experienced difficulty in recent months, whether that’s through a separation, business difficulties or redundancy, as opposed to pre-2007 when sub-prime products were available to those looking to take out a mortgage – or multiple mortgages – based on a self-certification model.

So, for those who might fall within the adverse mortgage category and are aware of ‘booming Bournemouth’ and its appreciating property values, then there is no need to panic – but we would advise that those considering applying for a mortgage in Bournemouth act sooner rather than later before continued house price growth really does make homeownership a more exclusive proposition.

If you’re considering applying for a mortgage and feel that an adverse credit mortgage product may best suit your needs, contact Complete Mortgages on 01202 049661 or email enquiries@complete-mortgages.co.uk.

*UK Cities House Price Index

Mark Lucas, Adverse Mortgage Specialist at Complete Mortgages


Why ‘subprime’ is no longer a dirty word

Wednesday, 25th May, 2016
adverse credit mortgage

Looking back to the crash of 2007/8, when subprime lending was in its prime, it is easy to be scathing of an arrangement that was, arguably, instrumental in the collapse of the economy, the impact of which was felt by many people for many years.

Since then, we’ve seen – and continue to see – the tightening up of the financial services industry and a focus on making the UK economy as robust as possible.

Quite recently, we’ve also seen the resurgence of the subprime lending sector, too.

Is this revival a sign that we haven’t learnt from our mistakes? Is the industry heading once again towards financial irresponsibility? I believe that the answer is ‘no’, and here’s why.

A tight ship

The regulatory work that has been implemented by the Financial Conduct Authority since the financial downturn is unprecedented. Never before have professionals and companies, such as Complete Mortgages, had to adhere to so many rules and guidelines. Put simply, the financial services industry currently works within a much tighter framework and is subject to much more scrutiny. Any products available within this framework, even subprime products, will have faced intense scrutiny before being released to the market.

Niche, not the norm

Unlike the pre-crash period, whereby subprime mortgages were easier to access and where less evidence of affordability was required, subprime 2.0 is aimed at a much smaller demographic. There were cases of multiple subprime mortgage products being granted to one person on the strength of the fact that that person simply stated that they could afford to make their mortgage repayments. This is no longer the case; those applying for a subprime mortgage need to provide evidence that they are financially robust enough to be granted a sub-prime mortgage loan in the first place. In fact, most lenders insist that applicants can only apply if their poor credit rating is a result of what is referred to as an ‘unexpected event’.

Unforeseen circumstances

Nobody can predict the future. Of course, we all make decisions based on the information we have at any given point in time but nothing is guaranteed. Businesses fail, people are made redundant and marriages, sadly, fall apart. In fact 130,473 UK couples divorced in 2013 and whilst it was the lowest level in 40 years, it’s still a significant number and one that is likely to contain a proportion of people whose separation places more pressure on their finances. The unexpected does happen and setbacks do occur. And when they do, isn’t it only right that rather than be excluded from homeownership, those affected are provided with an option that enables them to maintain some sense or order?

The new wave of sub-prime mortgages

It is worth noting that those who need to apply for a subprime mortgage will pay more than those applying for standard mortgage products. However it’s also worth reiterating that the post-crash subprime mortgage has been created to cater for those who have experienced a financial setback and who, as a result, are now classed as having an adverse credit score – even through no fault of their own.

Life is never black and white; there are always shades of grey in-between. The new subprime mortgage acknowledges this. Unlike the prime market, whereby decisions are made, in part, by computers, brokers providing subprime mortgages spend more time listening to an individual’s circumstances before making a decision. And that, from my perspective, can only be a good thing.

Get in touch with Guildford mortgage broker, Complete Mortgages, if you would like to discuss what subprime mortgage products are available to you. Contact 01483 238280 or email info@complete-mortgages.co.uk.

By Mark Finnegan, Director at Complete Mortgages