Reasons Your Mortgage Application in Bristol Has Been Declined

Failing a credit score

The benchmarks for passing a credit score differs depending on the lender. Sometimes it can be easy; other times it can be strict and challenging to pass. If a lender likely has failed you, you might not have been told why you failed. In some cases, this is because it was a combination of little things, and in truth, they aren’t sure why you had been declined.

It’s at this moment where you will feel the advantages of a mortgage broker in Bristol. We are here to help you and guide you everywhere in the early stages, right through to the end of your mortgage journey. Beforehand, it is strongly recommended that you obtain a copy of your credit file to show your Mortgage Advisor in Bristol.

They will be able to go through it with you and try to match you with the most suitable lender for your situation. The more deposit you have available for you to put down, the easier your chances will be to pass a credit score for a mortgage.

There are things you are able to do to improve your credit score, such as using a credit card regularly (if you have one) and ideally paying off the balance in full each month. You will also need to be on the voters roll for the area of which you live. That one can often be overlooked but is incredibly helpful. You can also close down old bank accounts and credit and store cards that you have since stopped using.

If you fail one lender’s credit score, do not give up! There may still be another lender willing to accept you, though please be wary about having too many hard credit footprints registered against you, as too many hard searches can affect your credit score.

Declined For a Mortgage On Affordability

The different lenders have their own individual ways of calculating how much you can borrow. It’s entirely plausible that you could approach 10 different Lenders and each one give different answers. Some lenders are more generous than others depending on the circumstance, with some, for example, known to be fairer to those who are self-employed.

Some mortgage lenders can consider assessing 100% of an employee’s overtime and bonuses, though this is not the case with every lender. Depending on the lender, some will also accept “unearned” income such as tax credits, child benefit and maintenance.

A mortgage broker in Bristol who deals with First-Time Buyer Mortgage Advice in Bristol can approach several different lenders without the need for a credit check, in order to perform an affordability assessment. If you are looking to buy a home, we would highly recommend that you have an affordability assessment carried out before you start viewing properties to avoid potential disappointment in the future.

If you are Moving Home in Bristol, proving that you have maintained mortgage or rent payments in the past is not an immediate guarantee that you will pass a lender’s own affordability test.

Outside of Lending Policy 

All lenders have their own specific, strict mortgage lending criteria, with some being better than others in certain situations. Lenders look to carve out niches for themselves to fit into, as a means of attracting good quality mortgage borrowers who might not tick all of the right boxes for their competitors.

Some examples as to why your application has been declined for being outside of policy are: 

An experienced Mortgage Broker in Bristol will use their experience of lenders and criteria tools to recommend the most suitable mortgage for you, based on your own personal circumstances. If your situation is a little more complex, then you should look for mortgage advice as being declined elsewhere may affect your chances of being accepted for a mortgage going forward.

The Pros & Cons Of Using A Mortgage Broker in Bristol

Making an initial step onto the property ladder for the first time, or taking the next step once your fixed term ends, can make you feel a little nervous from time to time.

There are lots of different routes that homeowners and home buyers can take, but if you can help it, it would be ideal to get it right the first time, especially when you’re dealing with a large amount of money.

Of course, we are strongly in the belief that our service as an open and honest mortgage broker in Bristol, will be beneficial to anyone who is going through their mortgage process, especially if you are a first-time buyer in Bristol.

Whilst we have confidence in our ability to help out our customers, we are also fully aware that it is not necessarily for everyone. Some may even be unsure of how exactly we can help.

With this in mind, we have compiled a balanced overview of why in some cases you might be better off getting in touch with a mortgage broker in Bristol, and how in some other cases, going direct might be your best choice.

What are the pros & cons of using a mortgage broker in Bristol?

Cost-Effectiveness

It is the opinion of many, that you are a lot more likely to save some money by going directly to the bank and finding a mortgage deal yourself. There is indeed merit to this, as a mortgage broker in Bristol may charge you a fee, though this is circumstantial and depends on who you speak to.

If you are already experienced in finding your own mortgage, have a pretty simple case and have a knowledge of lender criteria, going it alone will probably be easier and more cost-effective.

Where a mortgage broker stands out, is the ability to help people with complex cases or those who don’t understand lender criteria.

Without the correct, up-to-date knowledge, you could possibly end up with a bad deal, or even being unable to successfully apply for a mortgage deal. In any case, this could cost you a lot of money or damage your credit score. The latter would in turn hinder your chances of applying for a mortgage at any point in the future.

A dedicated mortgage advisor in Bristol will always make sure that they get their recommendation right the first time, at the cheapest deal that is available to you. Again, this may entail you having to pay a service fee, though it will likely save you a lot more money in the long term.

Local Bank Branch Relationships

Another point of view that customers who are older may think is a benefit of going to the bank directly, is the way you used to be able to get a mortgage. Prior to technology and online banking becoming a big deal, generally you would be a loyal customer of a local branch, typically speaking with the same members of staff.

When you wanted to apply for a mortgage, you would converse with the bank manager themselves. They would “know your finances like the back of their hand”, and would be the ones to personally approve a mortgage for you. Times have changed though, and credit scoring is now done via digital means.

The bank manager will no longer personally go through your case. Instead, your information will be put against a complex online system, to find out if you qualify for that mortgage. Nowadays, everyone gets the same chance as each other, no matter who your bank is.

Exclusive Mortgage Products

Relating to the previous point, many are in the belief that there are better, exclusive deals only by going to the lender direct. Once again, there is an element of truth to this, but it is only part of the story. See, a lender can indeed offer great deals, but only deals that are from their own company.

One of the main problems here is that not all mortgage lenders are actually banks, meaning there are lots of options outside of what you are familiar with. The best deal you could get with your bank, might not be the best deal overall that you could’ve had access to.

That’s another benefit of enquiring for mortgage advice in Bristol. A trusted and experienced mortgage advisor will be able to take a look at your case, and have you matched up with a suitable deal from one of our panel of lenders, rather than one place.

It’s also worth mentioning that there may also be deals that can only be found with a mortgage broker in Bristol. Regardless of if you’re a first-time buyer, are considering your options for a remortgage in Bristol or have a complex case, a mortgage broker will have more options for you.

Changes to Regulation & Consumer Protection

Following on from the 2007-08 credit crunch, the mortgage market was in dire need of a change. As was outlined in the 2014 Mortgage Market Review, lenders no longer had the ability to sell mortgages to customers on a non-advised basis.

This meant that you couldn’t just approach the bank, tell them you want a mortgage and be approved without any prior checks. You also couldn’t obtain a mortgage from any member of staff, as this used to happen regularly, whether they were qualified or not.

Further to this, these changes also introduced consumer protection, that you otherwise wouldn’t have gotten from the bank.

You now had the right to make a complaint to the Financial Ombudsman if you felt mis-advised for one reason or another. You also have the ability to make a claim via the Financial Services Compensation Scheme.

This is positive thing for both mortgage brokers and mortgage lender alike, as this means no matter who you choose to speak to or what your circumstances are, you’ll be safe, secure and advised professionally.

Booking an Appointment with a Mortgage Advisor in Bristol

An area where a mortgage lender has the disadvantage, is that oftentimes it can quite literally take months to speak book an appointment. Once you can eventually speak to someone and kickstart your journey, you’re not always guaranteed to be kept up-to-date about your case progression.

A unique selling point here at Bristolmoneyman, is that we are able to speak with customers at a time that is convenient to them. Our mortgage advisors in Bristol work from early until late, 7 days a week, including weekends. We may also work on some bank holidays too!

If you’re quick enough and lucky enough, you might find that you can book an appointment on the same day, though you don’t always have to do that. If you would like to speak with someone in a few days time, you have the freedom to book a slot in advance!

We are here at time slots that best suit your lifestyle. If you work 9-5 and want to speak with someone in the evening, we can do that too! Using our online booking feature, it has truly never been easier to get in touch with a qualified mortgage advisor!

In addition to this, we are proud of our ability to be responsive with our customers. No matter what stage of your mortgage journey you’re in, we will always make sure you’re up-to-date. If your case changes at any point, your advisor will inform you as soon as they can.

It’s because of expert mortgage brokers in Bristol like us, who are able to offer a high level of customer service, that the public opinion of mortgage brokers has differed over the years. This has led to more and more people getting in touch with a local mortgage expert, instead of going to a big high street bank.

Handling of Complex Scenarios

Sometimes a mortgage case may be a little more complex than the average case. Common examples of this that we have come across over the years, include (but are not limited to);

In the past, mortgage lenders were able to easily compete, by offering better deals than the others. Times have changed though, and now the main difference in choosing a deal, is whether or not you match their strict criteria.

A deal could be cheaper, but you may not qualify for it. The mortgage lender will perform either a hard credit search (leaves a footprint on your credit file) or soft credit search ( this leaves less of a footprint on your credit file), to see if you pass eligibility checks for that mortgage.

If you apply for a mortgage with a lender and are declined an agreement in principle, this will likely cause harm to your credit file. Worst of all, you probably will not be given a reason for why you were declined, which can be understandably disappointing and frustrating.

On the other hand, a trusted mortgage broker in Bristol will be able to take a look at your case beforehand, making sure everything is correct and prepared, informing you of any other steps you should take to better your chances of being accepted for the mortgage.

Using the lenders that we have on panel, you’ll be matched up with deals that you could be eligible for and we’ll look to get you agreed in principle. Obtaining your agreement in principle through Bristolmoneyman typically takes no more than 24 hours of your free mortgage appointment with one of our advisors.

Of course, this still doesn’t mean you are certain to receive an AIP, nor does it guarantee that you will get a mortgage, but it is a lot better for your credit file to have an expert analyse it beforehand. As expert mortgage advisors in Bristol, we always look to make the right recommendation first time.

In Conclusion; Should I use a mortgage broker in Bristol?

At the end of the day , it’s your choice. As you can tell from the information above, there are both pros and cons to choosing a mortgage broker in Bristol. Conversely, there are also a lot of pros and cons to going direct with a lender. It all comes down to how quick of a service you would like, and how secure you want to be on your journey.

As a trusted mortgage broker in Bristol, led by 20+ year industry expert Malcolm Davidson, we have helped thousands of customers to achieve their mortgage goals. From first time buyers in Bristol taking a step onto the property ladder, to people reaching the end of their initial fixed period, looking to remortgage in Bristol, it’s safe to say we’ve seen it all.

To get in touch with a responsive, open & honest, FCA regulated mortgage team of experts, feel free to book yourself in for a free mortgage appointment or remortgage review, with a member of our amazing mortgage advice team. We’re here to help with all your concerns and queries during your process, with time slots that are convenient to you, subject to availability.

If you would like to learn more about our service, take a look at our genuine customer reviews. They are an amazing reflection of the service levels we provide our customers regularly. If you would like to learn more about the mortgage world, take a look at our YouTube Channel, MoneymanTV.

Getting Prepared for a Mortgage in Bristol

First Time Buyers Getting Prepared in Bristol

Once you’ve saved up for your money for a mortgage, the next step is preparation. You need to prepare for your mortgage application and get in a position where you are ready to start your process. If you are a first time buyer in Bristol, this guide will definitely help you progress with your mortgage application. Also, if you are Remortgaging or moving home in Bristol, you will still benefit from this article as it features some useful tips and tricks to help fast track your mortgage application.

Get Mortgage Ready in Bristol!

Up to date credit report

One of the first things that you should obtain during the preparation process is an up-to-date credit report. Having an up-to-date credit report is essential for your mortgage application; ideally, you should try and get yours arranged prior to approaching a Mortgage Broker in Bristol. Your report will be reviewed by your Mortgage Advisor in Bristol before passing it onto the correct lender.

Agreement in principle

Another thing that you should get ready is an agreement in principle. You need one to make an offer on a property!

If you want a fully credit-checked agreement in principle within 24 hours of your application, you should get in touch with us. As an experienced Mortgage Broker in Bristol, we can often turn around an agreement in principle on the same day of your application.

Proof of ID

In terms of proving who you are you’ll need to produce a photo ID. Most customers use a Driving license or passport for this element. You can’t use a Driving Licence for ID though if you are also using it for proof of address. If you are a non-UK national working over here on a Visa, you’ll need to produce that too.

When looking at proof of ID, the required documents will have to be photo identification such as a Driving Licence or Passport – though if you’re using one for proof of ID then it can’t be used as a proof of address. If you are a non-UK national working in England on a Visa then this will also need to be presented.

Proof of address

In addition to proof of identification, you will also be required to prove where you live. This is usually in the form of a utility bill or bank statement within the last 3 months.

Last 3 months’ bank statements

Your bank statements should reflect your income and regular expenditures. It will be displeasure to Lenders if they see gambling transactions on your account and they will also not be happy if you are seen to have surpassed an agreed overdraft limit or your direct debits have bounced regularly. The key factor is to get ahead of the game and get prepared as best as you can.

Not all lenders will ask to see your Bank Statements but it is an option that is available to them if they choose to utilize it – regardless of whether they do ask for your bank statements, they want to be confident that you take your finances seriously. The bank statements which you produce should consist if your salary going in and your bills going out.  

Evidence of deposit

A vital step in the mortgage application is evidencing your deposit for Anti-Money Laundering purposes. To help the process it is best not to move finances around your accounts too much as this will make it a lot more difficult and may delay the process.

Lenders like to see that you are saving your money responsibly, but that doesn’t exempt you from having to account for any large recent deposits into your accounts. If you have been gifted a deposit, then there will need to be written confirmation stating it’s a non-refundable gift.

Proof of income

The most pivotal point of the application is proving your income. If you’re in employment then sufficient evidence would be your last 3 months’ payslips, though some lenders will also ask for your most recent P60. Lenders will take into account regular overtime, commission, shift allowance and bonuses. Additionally, extra earnings may also be considered with some lenders such as part-time jobs or self-employment.

Many applicants are Self Employed in Bristol nowadays – if you are a self-employed applicant then you may mean you will need to acquire your Accounts’ help to request your last two or three years’ proof of earnings from the Revenue. If you submit your own accounts then feel free to get in touch and we will be happy to advise you on how to go about downloading from the Government Gateway.

Budget planner

By working out an estimate of your expected outgoings after you move house means you can gain an idea of how much disposable income will be available to you to pay your mortgage after such things as regular expenditures, council tax, and utility bills have been paid out from your account. To help you with this, we are happy to send you our version of a Budget Planner to get you started.

As seen, there are many steps you must take in order to prepare fully for your mortgage application deeming it not an easy feat but it doesn’t mean you should worry. If you approach the mortgage application with due timing and an organized matter along with a Mortgage Broker in Bristol, you will be in safe hands.

Can I Have Two Mortgages in Bristol?

Yes, there is most likely an option where you can have two mortgages as there are many situations that require a person to have more than one mortgage. Our Mortgage Advisors in Bristol can typically help with this.

Some of the reasons for wanting a Second Mortgage could be:

Second mortgage to raise money

If you have equity in your home and are looking for a second mortgage to release some of this to fund a purchase, then we may be able to help.

This situation is known as a further advance. A further advance is when you borrow more from your current lender to fund something like home improvements or a second mortgage.

The amount that you can borrow from them will depend on the amount of equity in your property. Your lender will need strong evidence to prove that you can afford both mortgages. Our mortgage advisors in Bristol can access competitive second mortgage deals and options through our large panel of lenders. 

Second mortgage to rent out existing home to purchase a new one

If you are looking to move house but keep hold of your existing property with the view to let it out, we may be able to help. Your second mortgage will be a new residential one.

Second mortgage to purchase a home for your children

If you are exploring the options available to you of helping your children or grandchildren with getting on the property ladder, there are now many products that we can run through to achieve this.

Second Mortgage for a Buy to Let

If you are looking to purchase a Buy to Let our Mortgage Advisors in Bristol will advise you on the best way to go about this. You will get asked to produce a higher deposit for this than a residential mortgage.

Named on your existing mortgage and want to buy a new home?

Are you currently named on another mortgage and would like to purchase a new property? In any case, this is a situation that our Mortgage Advisors in Bristol come across regularly, mainly due to divorce or separation and we are often able to help.

Whatever your situation is to get a second mortgage. As an Experienced Mortgage Broker in Bristol, we can search 1000’s of mortgage deals on your behalf. Additionally, recommend the most suitable product for you based on your situation.

Why Use Our Mortgage Advice Service in Bristol?

We Specialists in Different Types of Mortgages

As a dedicated mortgage broker in Bristol, our job is to support you through your mortgage process from beginning to end, making it a stress-free and easy-going experience. We aim to find you the most suitable mortgage product tailored to your specific financial and personal circumstances.

We feel the customer should know exactly how our service works and what different order parts of the process come in. So, to give you an insight into our process and how it works, we have put together a handy guide that we think you will find helpful.

How does our process work?

Step 1 – Get in touch

First of all, once you have contact and speak to one of our responsive teams or book yourself in for a free mortgage appointment, they will take some details from you. This is to help build a profile to get a picture of who you are and what you’re looking to do. All this information will help us, partner, you up with a suitable mortgage advisor in Bristol.

Step 2 – Free mortgage consultation

During your free consultation with your dedicated advisor, they will ask you a few more questions. This will give them a closer look into your mortgage needs. From here on out, this advisor will help you find the ideal mortgage deal for you!

If they manage to find you a great deal that benefits both your personal and financial situation and you’re happy to take it up, we are ready to continue to step 3.

Step 3 – Agreement in principle

This step continues right after your consultation. Your advisor will arrange a mortgage agreement in principle (AIP) for you within 24-hours of your consultation.

Having an agreement in principle in place early on in the process is crucial. It shows a seller that a lender is willing to let you borrow from them. Of course, this can provide evidential documents to back up your income and credit score.

During this part of the process, if you haven’t already found a home to make an offer on. You can start hunting for houses with your agreement in principle to back up any offers.

After your agreement in principle is in place, we’ll begin collecting evidential documents from you to back up your mortgage application. This will include things like payslips, bank statements, photographic ID. These documents and the amount that you need to supply do vary if you are a self-employed applicant.

Step 4 – Submission

As soon as everything looks good on our end, we can move to the mortgage application submission stage!

We will only submit your mortgage application if we know that you’ll pass your lender’s credit scoring criteria; we don’t want it to be declined. Once your application is with your potential lender, it’s just a waiting game now. During this time, we’ll be regularly informing you on the progress of your mortgage application.

As soon as we get the green light, we will be in touch straight away to give you the confirmation that you’ve had your mortgage application accepted. Congratulations, you’re now on the road to moving into your new home!

Specialist situations

At Bristolmoneyman, we want you to have the most straightforward mortgage process possible and come out with a great mortgage deal. However, we also deal with complex cases, so if you are struggling to get a mortgage through the traditional mortgage route, our service is in place to offer help when needed. 

Our mortgage advisors in Bristol have been helping customers overcome complex cases for over 20 years now. We have had customers in the past who been turned away from their bank, and we’ve still been able to get them a mortgage offer. We love a good challenge, and our team would love to help anyone struggling with a complicated mortgage situation.

Speak to a Mortgage Advisor in Bristol Today

Now that you’ve learnt more about our service, it’s your job to get in touch. We are available 7 days a week. Book your free mortgage appointment today to speak to an experienced Mortgage Advisor in Bristol today.

Customer service means everything to us, and we want to ensure that you’re delighted with every part of our service. But, of course, it would help if you took advantage of our free consultation. So whether you’re a first time buyer in Bristol or moving home in Bristol, we recommend getting in touch now.

How Much Deposit Do I Need To Buy A House in Bristol?

The amount of deposit you need to buy a property entirely depends on your personal circumstances and what it is exactly what you are looking to achieve. Here we explore how much you may be required to save for, depending on those factors.

Why do I need a deposit anyway?

In previous years, 100% mortgages were readily available and some lenders were offering 125% loan to value mortgages. What this means is that if you were buying a property valued at £100,000 they would lend you up to £125,000. It’s no surprise with that method, that things went very wrong.

Lenders require you to put down a deposit simply to lower their lending risk. If they lend you 100% of the purchase price and you somehow fall into arrears, leaving them to take possession of the property, then it only takes a minor reduction in house prices for them to suffer a loss. Of course, this is something they would like to avoid.

There is also the thought some have that says if you haven’t invested some of yours or your family’s money into your home, then you might find it a bit too easy to “walk away” should the going get tough and you were finding it difficult to keep up your monthly repayments.

Also, if you are not yet able to save up say, 5% of the property purchase price yourself then it could be debated that you’re not yet prepared to get onto the property ladder.

Won’t the government pay the deposit for me?

No, but if you can find 5% of your own resources then you might find yourself qualifying for the government’s Help to Buy equity loan scheme. This only applies to new build properties. You put in 5% and the Government loans you up to 20% to make up the rest as a 25% deposit.

After 5 years you will need to see about paying the equity loan back possibly by way of a remortgage or from savings you have been able to save up during your mortgage term.

Is a 5% deposit enough?

Currently, yes 5% is enough in the majority of situations. Not all Lenders will accept only a 5% deposit though, so your options may be a little more limited. Normally you will need a reasonable credit score to qualify for a mortgage.

You may still find lenders out there that would consider you for a 95% mortgage with an average credit score but the rate of interest would be higher.

My credit history is poor – how much do I need to put down?

Most specialist lenders would prefer to put down at least 15% deposit if you have a considerably poor credit history. As mentioned in an aforementioned point, this is purely to reduce their risk in case a repossession occurs. It is much more difficult to obtain this type of mortgage than it was in the mid-2000s but it is still possible.

What about Buy to Let?

It’s always been necessary to put down a larger deposit for Buy to Lets and most lenders at the moment are looking for 25%.

Can I take out a loan for the deposit?

This may be possible in very few cases, but the vast majority of lenders won’t let you do this, as this would practically still be 100% lending and this isn’t something seen anymore.

Can someone gift me a deposit?

This is something that happens all the time! Usually, it’s “bank of Mum and Dad” (birth parents, adopted parents and legal guardians) gifting or other family members.

In some cases though, family friends can gift you money, so long as they can evidence the funds, prove who they are and confirm they are not expecting it to be paid back as a loan.

Are there any circumstances where I don’t need a deposit?

If you are purchasing as a sitting tenant at a discount from the open market value, from a family member or if you qualify for a discount under the Right to Buy scheme then you usually wouldn’t need to put any of your own money in as the equity is already “built-in” to the deal.

Please remember that the above information is for reference purposes only and is not to be seen as personal financial or mortgage advice.

What is a 95% Mortgage?

A 95% mortgage is as simple as the name would suggest; you are borrowing against 95% of the price of a property, and then you are covering the remaining 5% with your deposit. An example of this is if you looked at buying a property that was worth £150,000 with a 95% mortgage, you would be putting down £7,500 as your deposit and borrow the remaining £142,500 from the lender.

95% Mortgage Advice in Bristol

Off the back of the March 2021 Budget, Boris Johnson announced a Mortgage Guarantee Scheme for mortgage lenders, making 95% mortgages more readily available from the bigger high street banks.   

This is fantastic news for First-Time Buyers and Home Movers alike, as this scheme will continue running until December 2022. Certain terms and conditions will apply though, which is something your Mortgage Advisor in Bristol will be able to look at, to see if you qualify.    

All our customers who opt to get in touch will receive a free, no-obligation mortgage consultation where one of our dedicated mortgage advisors will be able to make a recommendation on the best possible route for you to take.

Can I get a 95% mortgage?

95% mortgages are usually accessible by both first time buyers in Bristol & those who are moving home in Bristol. Whilst saving for a 5% deposit sounds like a pretty straightforward concept, you’ll still need to have an acceptable credit score and prove that you are able to afford your monthly mortgage repayments, in order to access a 95% mortgage.

Improving your credit score

A good credit score is essential in the process of obtaining any mortgage, especially a 95% mortgage. Things like paying any current credit commitments on time, ensuring your addresses are updated and checking that you’re on the voters roll, can all help with your credit score.

Affordability 

Affordability is another one that is important to take note of. By giving the lender details of your income and monthly outgoings (things like your bank statements will be necessary for this) and any pre-existing credit commitments, your lender will be able to get a general overview of whether or not you are able to afford this type of mortgage.

Can my family help me get a 95% mortgage?

Nowadays we see lots of family members helping each other get onto the property ladder, especially parents looking to further their children’s lives. The way this usually happens is by gifting the person looking to find their home, the deposit required. Known through the industry as the “Bank of Mum & Dad, Gifted Deposits are only intended to be a gift, and not as a loan. The lender will need proof that this has been agreed, before it can be used towards your mortgage. 

How do I choose the right 95% mortgage?

When looking for a 95% mortgage, you want to make sure you have the right type of mortgage. Each mortgage type works differently, with that choice allowing you to find one that is most appropriate for your personal and financial situation. 

Some homeowners and home buyers prefer Fixed Rate or Tracker Mortgages, mortgage types which mean you either keep interest rates at a set amount for the term given or have your interest rates tracking the Bank of England base rates.

Alternatively, you might find that Interest-Only or a Repayment Mortgages are more your style. Interest-Only allows cheaper payments until you need to pay a lump sum at the end (mostly now used for Buy-to-Lets), whereas a Repayment mortgage (a normal mortgage if you’d like) means you’ll be paying interest and capital combined per month.

How can a bigger deposit help with my mortgage? 

Seeing as a mortgage is such a large financial outgoing, you need to be prepared and need to be aware. You might find things like higher interest rates, remortgaging difficulties due to less equity and then negative equity all cropping up if you’re not. 

There is no need to worry though, as all these can be avoided if you’re savvy enough with your process to begin with. The more deposit you put down for a property, the less risk the lender will see you as. 

A larger deposit, of say 10-15%, would not only reduce the rates of interest by a noticeable amount, but would also give the property more equity and reduce the risk of negative equity, thanks in part to you borrowing less against the property. 

So, whilst the risks may seem intimidating, planning ahead and saving for a bigger deposit to access something like a 90% or even an 85% mortgage will be a massive help in your mortgage journey and something you’ll be able to reap the rewards from in the future. 

Buying a Property With a Partner or Friend in Bristol?

Purchasing with a Friend / Partner in Bristol

In some cases, a practical way to get on the property ladder as a first time buyer in Bristol or home mover in Bristol could be buying a home with a friend or partner. The deposit can be raised quicker and bigger than it would be from a single income, also the costs will be shared. It’s important to remember that if one defaults, the other could be responsible for the full mortgage. Therefore, here are some points to look out for from our mortgage broker in Bristol.

The facts – How many people can jointly own a property?

The maximum amount of people that can jointly co-own a property is four. When you jointly co-own a property, you have a legal right to stay in your home unless a court rules otherwise. Furthermore, if a person would like to sell or take out extra borrowing against the property this is something all owners will have to consent to. Unless a court order state otherwise.

Joint tenancy or tenancy in common – what’s the difference?

Civil partnerships or married couples usually prefer joint tenancies. In a case where one of the joint tenants dies, then the property immediately is passed to the other owner. The law sees joint tenants as one unit which means you can’t remortgage or sell the property without the agreement of the other owner.

Relatives or friends who are buying together tend to go for tenants. You may jointly own the property but you do not have to own equal shares. Therefore, you can act individually meaning that you have the right to sell or give away your share of the property. There is a way you can mortgage your share of the property, but it would be difficult to find a lender that will lend in these circumstances.

Joint Mortgages & Removing Names

What happens if you have a joint mortgage, but the other parties stop meeting the mortgage payments?

All borrowers are jointly and severally liable, which is something a mortgage lender will highlight to you. If a situation occurs where one of you stops paying your share of the mortgage, then the other(s) will make up the shortfall and pay the full amount.

How do I remove my ex-husband / wife from my mortgage?

Buying a mortgage is a big financial commitment, therefore, you should commit to this with the intention of not splitting up in the future. In the circumstance that this does happen, you would have to make changes to the mortgage which can be a difficult situation.

In the case that children are involved in the situation, one person will be occupying the home, however, there might be a point where the person would want to take over the mortgage in their own right and therefore will need Mortgage Advice in Bristol.  

Regardless if one of the parties in the joint mortgage is paying the mortgage without any help from their ex, the application was still processed in joint names. Therefore, in the event of mortgage arrears, both parties are accountable even if only one person is trying to upkeep payments. 

The lenders will have to be confident that the applicant remaining can keep up the payments on their own from then before removing a party from a mortgage. To determine this, the lender will need to carry out a full assessment of income even if you have been consistent with your mortgage payments in the past. 

It’s common in these situations that the individual who steps in to replace the ex-partner is usually a family member or a new partner. When it comes to this change, a Mortgage Advisor can help you go through this process. 

How do I remove my name from my ex-partner’s mortgage?

In the case of a separation or divorce, it’s key that you know that all parties remain responsible for any joint financial commitments. If a person leaves the family home, this still applies as well as if an agreement is made between both parties that one person will be responsible for all the payments. 

If you are looking to purchase a new property in the future, the mortgage payments on the previous property will be accounted for. That’s why it’s important that a person gets Mortgage Advice in Bristol prior to making an offer. Many lenders are more generous when it comes to the amount they will lend in comparison to others. Our Mortgage Advisors in Bristol will take this into consideration when recommending the most appropriate lender to apply for a Mortgage Agreement in Principle with.

Planning to Get a Mortgage in Bristol?

Getting Ahead of The Mortgage Game

It’s very important that you plan your mortgage journey in advance. There are various steps to take before jumping into offers and full mortgage applications to put you ahead of other first time buyers in Bristol.

One of these that should be at the top of your list is getting a mortgage agreement in principle, before searching for properties. Sometimes your plans might not go to plan. Unfortunately, even the most meticulous planners have a challenging process.

Some of these include poor credit, banks not lending enough, or even couples separating mid-process. The latter is not something that people can always prepare for, and it can cause you to take out a mortgage as a sole applicant, with very little time to plan again.

Why Planning For a Mortgage is Important

As mentioned earlier, planning is important because you can often find that your mortgage process will face many different obstacles. Having worked in the industry for over 20 years we have encountered many mortgage scenarios.

Below are some common problems we have found customers encounter:

By preparing yourself in enough time for all eventualities, you can potentially avoid as many of them as possible, ensuring a much smoother service. There are some inevitable cases, that’s where a mortgage broker in Bristol can often lend a helping hand.

Saving For a Deposit

Saving for a deposit can be quite difficult for some, especially when you try to make sure you achieve all your mortgage goals. This is even more so for first time buyers in Bristol who are renting and trying to save for their deposit simultaneously.

To get on the property ladder, you usually need at least 5% deposit, although this may be higher depending on circumstances. The question is, while this seems small, that can actually be a large amount of money, depending on the property price. You generally will not know the exact amount until you find a property.

Sometimes, when you have trouble making up for this percentage, you can get financial support from your family or friends through a gifted deposit in Bristol. Also, you might be able to use one of the various Help to Buy Schemes in Bristol.

These are usually popular with many first time buyers in Bristol to get them onto the property ladder. There could be a mortgage scheme out there that is perfect for you and your circumstances.

The Impact of Your Credit Score

Credit scores are a major factor in your mortgage application. If your credit score is in poor condition, you will be less likely to get a mortgage, perhaps even not being able to get one with decent interest rates and repayments, depending on how low it is and your situation.

Obviously, it all depends on why your score is so low. Having bad credit due to something like a CCJ or bankruptcy will reduce your chances greatly, with the length of time that has since passed being a factor in this too.

Check My File is a fantastic website we would recommend you use if you are wanting insight into your credit score. This allows you to get a copy of your credit report that our team can view completely free of charge.

Current Financial Position

When it comes to applying for a mortgage, it is important to look at how well you manage your finances. This is because mortgage lenders will conduct a thorough analysis of these, checking your bank statement, income and outgoings.

Gambling transactions are something that they will be searching for. Large and frequent expenses can make you look unreliable with your money and have a significant impact on your chances of getting a mortgage. We recommend holding back for a couple of months, to paint yourself in the best light.

If you find yourself lucky to get a gifted deposit for your mortgage. We also suggest that the gifter keeps the money in his account so that you don’t have big bank transfers that would otherwise look suspicious to a mortgage lender.

Are you self employed in Bristol?

If you are self employed in Bristol, you may find that your process will be different, then an employed applicant. This is because you will need to provide different evidence.

The evidence you need to provide as a self employed applicant includes your review of the tax year and the last 2/3 years of accounts, to name a few. This depends on the mortgage lender you are going with, but more evidence may be required.

Other Mortgage Hurdles

Through your mortgage journey, you may find a range of hurdles that could limit the quickness of your process or even stop it. Preparing for them in advance can put you in the best position if they happen.

A mortgage broker in Bristol like us will work hard to help you overcome these hurdles. We are here to support you 7 days a week, from early until late. Book online and benefit from expert mortgage advice in Bristol, today. 

How to get a Mortgage in Bristol if You’re Over 40

Aged 40+ Mortgage Advice in Bristol

Jumping straight into it, we can say that yes, depending on the circumstances surrounding your application, you will be able to obtain a mortgage over 40 years old.

If the mortgage term is going to extend beyond the age of retirement, the mortgage lender may wish to see a projection of what your expected pension income is going to be.

Over the years we have noticed that a lot of the instances we face with customers in or over their 40s tend to be with first time buyers in Bristol. When speaking to these customers, we also heard from a large majority that they were previously declined due to their age.

Why are over 40s being declined mortgages and what can be done?

First of all, let’s take a look back at the past. Prior to the introduction of computerised credit scoring and the levels of regulation that are commonplace today, if you visited a building society in search of a mortgage, you’d probably speak to your branch manager.

From here they would take a look at your personal circumstances, including how well you have been able to manage your current account. Based on their findings, they would then decide whether or not to approve your application.

If you were accepted, you would then receive advice on the amount you could borrow, typically presented as multiple of your gross salary.

The issue here is that these income multiples didn’t account for the age of the applicant. Therefore, no matter if you were 30 years old or 50 years old, you could borrow the same mortgage amount either way.

Now at this point, you may be thinking “issue”? What issue, that seems fair? The truth is that if both applicants were due to retire at the age of 65, the outcome would be different for both individuals.

If we take a look at an example using a £70,000 (capital and interest combined) mortgage using a national interest rate of 5%:

In this example, we have two applicants who earn the same, set to retire at the same age, with the same mortgage interest rate and the same overall amount to pay back. Where it differs, is that applicant two’s monthly payment is a lot higher. Because of this, if mortgage rates happened to rise, they would be at a much greater risk of arrears and repossession.

This is the reason why modern mortgage calculators now factor in the maximum term of the mortgage (i.e., how old you are) as well as the income you bring in and how much you have regularly going out.

Retirement Age

Even though it’s always made very clear that we will continue to work until an older age due to State Pensions, but the banks don’t seem to bear this in mind when it comes to giving out mortgages to applicants.

Lenders may potentially consider granting mortgages beyond the age of retirement, though this only tends to be if you can demonstrate your ability to afford the payments post-retirement. You are normally able to evidence this with a letter from your pension provider and a projection of your future income.

This does come with it’s own problems though, as the majority of people reading this article will likely take a reduction in income when they reach retirement. Because of this, lenders will need you to prove that even with a reduced income, you would still be able to afford your mortgage.

In practice, this hardly ever works unless you are only needing a smaller mortgage, though that would also mean you likely wouldn’t need to stretch the mortgage past your retirement age anyway as a shorter term could be affordable.

If you cast your minds back, you may recall that the default retirement age was scrapped in 2011 and you can no longer be forced to retire by your employer. As a result of this, fewer lenders are using the State Retirement age as the standard age they want mortgages to be paid off, with some even letting people self-declare their intended retirement age.

Preparing for a Mortgage at Over 40 Years Old

Regarding what you could be doing in order to obtain a mortgage over 40, you must prepare yourself for questions about how you will afford your mortgage later down the line.

Remember, the regulations have been put in place so they can protect consumers and encourage more careful lending from lenders.

If you need the mortgage term to run past the State Pension age, you will need to prove to the lender your expected income, so that they have confidence in your ability to maintain your monthly mortgage payments.

Please remember that the above information is purely for reference only and should not be viewed as personal financial or mortgage advice.

Bristolmoneyman.com & Bristolmoneyman are trading styles of UK Moneyman Limited, which is authorised and regulated by the Financial Conduct Authority.

UK Moneyman Limited is Registered in England, No. 6789312 | Registered Address: 10 Consort Court, Hull, HU9 1PU.

Authorised and Regulated by the Financial Conduct Authority.

We are entered on the Financial Services Register No. 627742 at www.register.fca.org.uk

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