Mortgage wars: a battle that shouldn’t be fought on price alone

Wednesday, 13th September, 2017

The Telegraph recently published a story that focused on the ‘battle for mortgage customers’ and the intensification of a war that is seeing lenders cut both their rates and penalty fees.

As a Guildford mortgage broker, Complete Mortgages feels and acts on the launch of each and every new mortgage product and the fluctuation of rates associated with those that already exist on a daily basis; indeed, it is our job to do so.

However, our view on the language used by the national media that places home buying in the context of a war – and the portrayal that the mortgage market is an arena in which only the cheapest product and lender will win – is bad not only for the mortgage industry, but also those applying for a mortgage.

Firstly, it’s important to highlight that the cheapest mortgage isn’t necessarily the best mortgage.

Evidence suggests that the average rate of two and five-year fixed mortgages has significantly decreased over the last seven years, and that’s undoubtedly a good thing. The more competitive lenders are, the more attractive their mortgage products become.

However – and this is very important – not everyone’s circumstances are the same. So, whilst a five-year fixed mortgage may be ideal for candidate A, it may not be so effective for candidate B.

Simply distilling mortgages and the mortgage application process down to a price war – something more akin to inexpensive consumer products such as bread and milk – doesn’t take into account the nuances surrounding each individual’s lifestyle and financial position.

It could also panic those looking for a mortgage into running headlong into a mortgage deal that may not necessarily suit their needs in the long (or even short) term.

The same Telegraph article suggests that lenders are already braced for a surge in new applications as a wave of existing fixed-term deals come to an end this autumn.

If this surge of applications originates from mortgage applicants who are well informed then we fully support that – but finding a mortgage broker who can guide you through the process and establish the right mortgage for you before you commit to anything should be your first port of call.

As an award-winning mortgage broker, our recommendation to those looking to secure a mortgage – or remortgage – is to seek professional mortgage advice; advice that treats a mortgage for what it is, which is a long-term commitment and not a simple day-to-day purchase.

If you’re looking at getting a mortgage – or remortgaging – this autumn then don’t get caught up in the bottleneck. From specialist self-employed mortgages and commercial mortgages through to first time buyer mortgages and adverse credit mortgages, Complete Mortgages can recommend a mortgage to match your own personal circumstances.

Contact us on 01483 238280 or email info@complete-mortgages.co.uk for an insightful, thoughtful and expert view on the current mortgage market – and a professional opinion on where you might fit within it.

By Mark Finnegan, Director at Complete Mortgages

Five reasons to use a mortgage broker

Tuesday, 22nd August, 2017
mortgage broker

Regular readers will know that we tackle pretty much every topic related to applying for a mortgage; from the actual mortgage products themselves (buy to let mortgages, commercial mortgages, residential mortgages etc.) to the legislation and changes in rules that either hinders or facilitates access to them.

However, on this occasion, I’ve decided to place the spotlight not just on the team of mortgage brokers at Complete Mortgages, but mortgage brokers as a whole.

Not because mortgage brokers have come under fire, or that that there is any particular reason to defend the work of a mortgage broker. It’s just that there are now a number of elements such as regulation, new rules, and restrictions that affects those wishing to apply for a mortgage.

This, on one hand, makes the work of a broker more complex and challenging, however on the other it’s allowing brokers throughout the UK to showcase how they can add value to their clients.

As a result, I would simply like to take this opportunity to remind homeowners and investors why using a mortgage broker can help expedite the mortgage application process and save a lot of heartache in the process.

From the recent changes affecting mortgage affordability to the latest set of rules from the Prudential Regulation Authority, which come into play in September and require landlords to provide details of their assets and liabilities, declare future investment property intentions and reveal the property schedule already requested for buy to let mortgage applications, there are now more obstacles to navigate than ever before.

And, as the number of obstacles grow, so too does the number of reasons to outsource your mortgage application requirements to a mortgage professional. Here are five.

1. Knowledge is power

This sub-heading is probably slightly over-egging the pudding, however it’s true that the more you know the more you can control. A good mortgage broker thoroughly knows the industry and, as a result, knows how to present your case in a way that reduces administration time and gets the desired result quicker. This knowledge, which non-mortgage brokers typically wouldn’t know, also enables brokers to sidestep the pitfalls and capitalise on any potential opportunities, thus ensuring you receive the best possible mortgage advice for your particular circumstances.

2. Qualifications count

It goes without saying, but those with formal training and qualifications in anything – from medicine and teaching to hairdressing and car maintenance – are more likely to approach what they do in a more efficient, balanced and professional manner.

3. Duty of care

Professional mortgage brokers are not only morally obliged to act in your best interests, but also the Financial Conduct Authority also heavily regulates them. If your mortgage broker is not acting in your best interest, then you’re covered. Complete Mortgages positively embrace the FCA’s Treating Customers Fairly initiative meaning that you will be treated fairly with the utmost duty of care at all times.

4. Bigger picture

Mortgage brokers assess and evaluate every aspect of your financial situation. Not only does this ensure that you end up with the right mortgage for you, but it also means that they can develop a holistic package covering other aspects of your financial planning such as life insurance, critical illness cover and income protection in one go.

5. No time to lose

If, like most people, you’re incredibly busy, then juggling mortgage applications with your job and family commitments is probably something you could do without. By using a mortgage broker you can offload the burden of finding the right mortgage – and the associated admin – freeing you up to either a) focus on doing what you do best or b) spend time on anything but applying for a mortgage!

As the mortgage lending landscape continues to change and lenders become more careful about whom they lend to, why spend time doing something that mortgage brokers can handle for you

Whether you’re looking to secure a mortgage or simply want to remortgage, then contact the team at Complete Mortgages on 01483 238280 or email info@complete-mortgages.co.uk to find out how we can help you.

By Mark Finnegan, Director at Complete Mortgages

Big changes for buy-to-let in 2017, but stress not

Wednesday, 11th January, 2017

The buy to let mortgage market is under fire once again.

Many buy to let landlords are still reeling from the changes announced by former Chancellor, George Osborne, which will see tax-deductible expenses reduced to 20% on a sliding scale from April 2017. And then there was the stamp-duty charge for second homes, which was introduced in April 2016.

However, when it comes to buy to let mortgages it seems that what might be regarded as ‘bad news’ for current and would-be landlords comes in threes.

Following the supervisory statement from the Central Bank’s Prudential Residential Authority on underwriting standards for buy to let mortgages, actually arranging a buy-to-let mortgage has now become more difficult.

Why? Because it has been deemed that there are too many buy to let mortgages in the market.

Now, applicants will have to undergo a ‘stress test’ that not only delves deeper into an applicant’s affordability levels, but also re-evaluates what affordable means.

Lenders will now be expected to assume a minimum borrower interest rate of 5.50% and potential interest rate rises will have to be considered for at least the first five years of the mortgage. Not only that, but landlords who own four or more mortgaged buy-to-let properties will need to submit income and mortgage details on each of them when they remortgage or purchase a new property.

As with most decisions that have the potential to have a significant impact on the property market, the rules will be phased in slowly and aren’t expected to come into effect until late 2017, however if you are a buy to let landlord looking to remortgage or thinking of applying for a buy to let mortgage then it’s probably worth considering your options sooner rather than later.

As a Guildford mortgage broker that specialises in buy-to-let mortgages and that has access to a comprehensive range of buy to let mortgage products, we are confident that we can offset some of the proposed changes by providing our clients access to a selection of products whereby the lender takes a more holistic approach.

For example, under the new rules, landlords with low rental yields may be thrown into the ‘unaffordable’ pile which, depending on the level of borrowing required, may jeopardise – if not scupper – their buy to let mortgage application. However, we have access to lenders who take into account personal income, too, which provides a much more balanced picture on what is and isn’t affordable.

Our advice is to get in touch with the Complete Mortgages team to find out how we can help navigate you through the buy to let mortgage application process and get you that step further to building your property portfolio – or, if you’re already a landlord, help you secure a mortgage that enables you to retain your position as a landlord.

Contact 01483 238280 or email info@complete-mortgages.co.uk for stress-free advice on what the new stress testing entails.

By Mark Finnegan, Director at Complete Mortgages

Mortgage boom for Bournemouth

Thursday, 18th February, 2016
mortgage broker in bournemouth

It really is boom time for Bournemouth. Not only is lending on the up, which means that more people in the area are arranging a mortgage, but also a survey carried out by a travel brand has revealed how Bournemouth is now one of the top trending hotspots in England.

Kent took the top spot of UK destinations with flight searches up by 602 per cent. Cambridge came second, up 288 per cent, with Bournemouth up a staggering 100 per cent*.

As a Bournemouth mortgage broker Complete Mortgages has witnessed the Bournemouth property market go from strength to strength over recent years. We’ve certainly seen an increase in mortgage applications and the recent swathe of deals to hit the market has only exacerbated this.

Even the Bank of England seems to be surprised by the amount of mortgage lending that took place in December (a period that’s generally quiet) after it was revealed how £18bn was released by banks and building societies during the Christmas month – up £3.3bn from the same period in 2014.

Looking at the increase in people applying for a mortgage in Bournemouth combined with the revelation that Bournemouth is a ‘top trending hotspot’, it would seem that the area is becoming a go-to place for homemakers, holidaymakers and investors alike.

So, if you’re a buy-to-let investor looking for a buy-to-let mortgage, or thinking of jumping on the Bournemouth bandwagon and simply want to move to the area, then get in touch and find out how we can help you secure a mortgage and be part of the Bournemouth boom.

Whether you’re looking to arrange a mortgage in Bournemouth or simply want advice on finding the right mortgage for you, contact me on 01202 049661 or email jo@complete-mortgages.co.uk.

By Jo Frankowski, Manager at Complete Mortgages’ Bournemouth office

*Momondo

Raising capital to live in the capital just got easier

Thursday, 4th February, 2016
london help to buy

Well, slightly. But when you consider that the average price of a London property is now £514,097*, then every little helps.

The good news, however, is that the move by the government to increase the Help to Buy Equity Loan Scheme’s upper loan limit from 20 per cent to 40 per cent for those looking to buy in London is more than just a gesture; it has the potential to be a real game changer for first time buyers looking to get their foot on the London property ladder.

So, what exactly is the new London Help to Buy? Well, it’s an official acknowledgement that properties in London are much less accessible than those elsewhere and, as a result, the government has taken steps to enable first-time buyers to access more mortgages. Prior to the change, those applying for a mortgage were, in effect, locked out of a high percentage of mortgage products due to the fact that the loan amount required was too high.

Now, those looking to arrange a mortgage with as little as a 5 per cent deposit qualify for a government equity loan for up to 40 per cent of the purchase price (which, under the scheme, is limited to £600,000). Not bad, when you consider that London property prices increased by 12.4 per cent in 2015 and look set to increase further.

With as little as £20,000, first time buyers can now purchase a property in London worth £400,000, with £160,000 coming from a government loan and the remaining £220,000 originating from the commercial lender.

The scheme is funded by an £8.6bn ‘pot’ earmarked to extend the equity loan programme from April 2016, when it was expected to end, until March 2021.

As a Guildford mortgage broker, whose remit is to help people throughout the UK secure a mortgage, we regularly represent those looking to get a mortgage on a London property. And whilst the revised allocation is a significant increase, there are many factors that property hunters need to be aware of. For example, lenders want to know that mortgage applicants taking advantage of the London Help to Buy can still repay their loan even if interest rates were to hit 4 per cent (which, on the £240,000 maximum borrowable amount, would mean that homeowners would need to find £800 in addition to their mortgage and other outgoings).

There has also been criticism of the scheme, with some industry figures claiming that the difference in price between London and non-London properties is already too high for the scheme to benefit those who are already hard-pushed to afford to own a property in London. Our view is that it comes down to each individual’s circumstances, all of which are different and can be discussed and reviewed during an initial meeting with a recommended mortgage broker. And that’s where the Complete Mortgages team comes in.

Let’s face it, navigating the number of products on the market on top of establishing whether a particular product is a) right for you or b) even available to you can be a slog. So, why not let us do the legwork.

From getting first-time buyers on the property ladder through to arranging buy-to-let mortgages for the self-employed, Complete Mortgages has built a reputation for helping people throughout the entire mortgage application process.

So, whether you’re looking to take advantage of the London Help to Buy scheme or simply want professional mortgage advice and guidance from a Surrey mortgage broker, contact the team on 01483 238280 or email info@complete-mortgages.co.uk.